Deposits to the Eurocurrency market originate from all of these EXCEPT ________. A) governments with excess funds generated by a prolonged trade surplus B) commercial banks with large deposits of excess currency C) international companies with large amounts of excess cash D) nongovernmental organizations seeking to avoid taxes
Deposits to the Eurocurrency market originate from all of these EXCEPT ________.
A) governments with excess funds generated by a prolonged trade surplus
B) commercial banks with large deposits of excess currency
C) international companies with large amounts of excess cash
D) nongovernmental organizations seeking to avoid taxes
A legal money market used for the currency outside of the country is called the Eurocurrency market. Banks, multinational corporations, and mutual funds utilize these markets. Deposits by governments, corporations, and commercial banks operating in the international market cause the formation of these markets. These markets are different from internal credit markets because they don't require reserves, interest rate regulations, withholding taxes, deposit insurance, and regulations influencing credit allocation decisions.
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