The risk that liquid funds will not be available in the volume needed by a bank is often called:
A)market risk.
B)price risk.
C)availability risk.
D)interest-rate risk.
E)None of the options is correct.

Question

Quizplus · Accepted Answer

The risk that liquid funds will not be available when needed is known as availability risk. Market risk is the risk of losses due to changes in market conditions, price risk is the risk of losses due to changes in market prices, and interest-rate risk is the risk of losses due to changes in interest rates. None of these risks specifically address the concern of whether or not liquid funds will be available.

The Risk That Liquid Funds Will Not Be Available in the Volume