A depository institution can accommodate withdrawal and loan demand by attracting additional deposits and raising short-term funds in the money market.

Question

Quizplus · Accepted Answer

Depository institutions, such as banks and credit unions, are able to meet the demand for withdrawals and loans by increasing their deposit base and raising short-term funds through the money market. This allows them to have the necessary funds to lend out to customers while also maintaining a sufficient amount of liquidity.

A Depository Institution Can Accommodate Withdrawal and Loan Demand by Attracting