Use the following statements to answer this question:
A) I and II are correct.
B) I and II are incorrect.
C) I is incorrect and II is correct.
D) I is correct and II is incorrect.
I.The major implication of backing money market funds by risky assets is an increase in money market spreads.
II.Bankers' acceptances yields are always lower than commercial paper yields.

Question

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I. The major implication of backing money market funds by risky assets is an increase in money market spreads. This is because investors will demand a higher return for taking on more risk.II. Bankers' acceptances yields are always lower than commercial paper yields. This is not true. Bankers' acceptances yields are typically higher than commercial paper yields because they are considered to be less risky.

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