Eurodollars are USD-denominated bank deposits held outside the United States, typically with fixed maturities, making them somewhat illiquid. They are not limited to European banks and can be held in banks worldwide.

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Eurodollars

Question 11

Multiple Choice

Eurodollars:

A) are USD-denominated bank deposits with fixed maturity and so are somewhat illiquid.
B) offer the borrower a lower interest rate than may be received in the domestic market.
C) are limited to European banks.
D) are somewhat illiquid USD-denominated bank deposits with fixed maturity, and offer the borrower a lower interest rate than may be received in the domestic market.

Correct Answer: