During the financial crisis of 2007-2009 in the United States it was revealed that the function of a lender of last resort had not kept pace with the evolving financial system because:
A) financial intermediaries had grown sufficiently large so as not to need a lender of last resort
B) shadow banks lacked access to the financial capital available through the lender of last resort
C) banks were sufficiently linked to one another that the need for a lender of last resort had diminished
D) banks had become sufficiently diversified so as to be able to provide for their own liquidity
Correct Answer:
Verified
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