Bank deposits are liquid; you can withdraw money on demand. How can the bank provide this liquidity

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Bank deposits are liquid; you can withdraw money on demand. How can the bank provide this liquidity and at the same time make illiquid loans to businesses?

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Fundamentals of Corporate Finance

ISBN: 978-0077861629

8th edition

Authors: Richard Brealey, Stewart Myers, Alan Marcus

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Question Posted: Jun 30, 2016 09:06 AM

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Bank deposits are liquid; you can withdraw money on demand. How can the bank provide this liquidity

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The key to the banks ability to provide liquidity to depositors is the banks a...View the full answer

Fundamentals of Corporate Finance

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