7-48 A natural consequence of the effects of realized liquidity risk across several institutions is the ability to recognize capital gains on the sale of assets in the attempt to generate cash.

Question

Quizplus · Accepted Answer

Realized liquidity risk often leads to selling assets at a loss, not a gain, as institutions may need to sell quickly, potentially at unfavorable prices.

7-48 a Natural Consequence of the Effects of Realized Liquidity