Asked by la douce Fleur on May 30, 2024

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Which of the following statements is true?

A) Money market mutual funds were originally introduced by the Federal Reserve Bank of New York.
B) Money market mutual funds initially constituted serious competition to banks and thrifts for the deposits of savers.
C) Money market mutual funds were not originally offered by commercial banks and still are not offered by them.
D) Money market mutual funds represent a pooling of cash assets from many countries,like dollars,francs,and pesos.
E) Money market mutual funds are not able to offer their customers check-writing privileges.

Money Market Mutual Funds

Investment funds that collect money from various investors to purchase short-term, high-quality debt securities and offer liquidity and relatively low risk.

Federal Reserve Bank

One of the 12 regional banks in the Federal Reserve System of the United States, which serves as the central bank of the country.

Commercial Banks

Financial institutions that offer a wide range of services, including deposits, loans, and other financial products to both individuals and businesses.

  • Recognize the role and impact of money market mutual funds in competition with traditional banking.
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ZK
Zybrea KnightJun 05, 2024
Final Answer :
B
Explanation :
Money market mutual funds were initially seen as serious competition to banks and thrifts because they offered higher interest rates on deposits, which attracted savers away from traditional banking institutions.