Which of the following would a bank NOT hold as insurance against the highest cost of deposit outflow-bank failure?
A)excess reserves
B)secondary reserves
C)bank capital
D)mortgages

Question

Quizplus · Accepted Answer

Mortgages are loans that banks make to customers and are not considered a form of insurance against deposit outflows. Excess reserves, secondary reserves, and bank capital are all forms of insurance that banks hold to ensure they can cover deposit outflows in the event of a bank failure.

Which of the Following Would a Bank NOT Hold as Insurance