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  3. Study Set
    Financial Markets and Institutions Study Set 5
  4. Exam
    Exam 21: Managing Liquidity Risk on the Balance Sheet
  5. Question
    Contagion Effect Occurs When a Failure of One DI Leads
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Contagion Effect Occurs When a Failure of One DI Leads

Question 2

Question 2

True/False

Contagion effect occurs when a failure of one DI leads to concerns among depositors about the solvency risk of the other DIs.

Correct Answer:

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