Which of the following is NOT a primary source of liquidity?
A)Excess cash reserves over and above regulatory reserve requirements.
B)Borrowings in the money market.
C)Borrowings in the purchased funds market.
D)Capital notes and other long-term financing alternatives.
E)Cash-type assets that can be sold with little price risk and low transaction costs.

Question

Quizplus · Accepted Answer

Capital notes and other long-term financing alternatives are not a primary source of liquidity. Primary sources of liquidity refer to cash or cash-like assets that can be easily converted into cash to meet short-term funding needs. Excess cash reserves, borrowings in the money market, borrowings in the purchased funds market, and cash-type assets that can be sold with little price risk and low transaction costs are primary sources of liquidity.

Which of the Following Is NOT a Primary Source of Liquidity