For a bank,there is always a trade-off problem between liquidity and:
A)risk exposure.
B)revenue generation.
C)profitability.
D)efficiency.
E)None of the options is correct.

Question

Quizplus · Accepted Answer

Banks face a trade-off between liquidity and profitability because holding more liquid assets typically results in lower returns, while less liquid assets can generate higher profits.

For a Bank,there Is Always a Trade-Off Problem Between Liquidity