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Choose the components of the shadow banking system.
a. savings and loan associations.
b. investment banks.
c. money market funds.
d. hedge funds.
e. commercial banks.

Sagot :

The proper responses are;

  • Investment banks (B).
  • Money market mutual funds [C]  
  • Hedge funds [D]

The production of credit inside the global financial system is facilitated by a network of financial intermediaries known as the "shadow banking system," which is unregulated.

Shadow banking

Shadow banking refers to unregulated non-bank middlemen who connect lenders and borrowers. Despite being a significant contributor to the global crisis of 2008–2009, shadow banking still plays a significant role in world economies.

Money market

Money market funds are businesses that offer less risky investments including certificates of deposit, interbank loans, and short-term securities like treasury bills. Money market funds in the United States are governed by the Securities and Exchange Commission (SEC).

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