A bank's liabilities include
A) both its reserves and the deposits of its customers.
B) neither its reserves nor the deposits of its customers.
C) its reserves,but not the deposits of its customers.
D) the deposits of its customers,but not its reserves.

Question

Quizplus · Accepted Answer

A bank's liabilities represent the claims that others have on its assets. The deposits of its customers represent the primary liability of a bank. Therefore, the correct answer is D, which indicates that a bank's liabilities include the deposits of its customers, but not its reserves.

A Bank's Liabilities Include