When Comparing Banks and Mutual Funds

Multiple Choice

When comparing banks and mutual funds,

A) mutual funds have more liquidity risk than banks because all shareholders share the loss of value on a pro rata basis.
B) mutual funds have less liquidity risk than banks because all shareholders share the loss of value on a pro rata basis.
C) mutual funds have more liquidity risk than banks because all shareholders have the ability to withdraw their money on a first-come first basis.
D) mutual funds have less liquidity risk than banks because all shareholders have the ability to withdraw their money on a first-come first basis.
E) mutual funds have the same liquidity risk as banks because both shareholders and depositors share the fall in the loss of value on a pro rata basis.