Which of the Following Statements About Depository Institutions Is False

Multiple Choice

Which of the following statements about depository institutions is false?

A) They borrow at lower interest rates and lend at higher rates.
B) They keep reserves to meet cash withdrawals.
C) They create liquidity by borrowing long and lending short.
D) They pool, and therefore reduce, risk.
E) A credit union is an example of a depository institution.