Question

Suppose that kenji and lucia called you to help them settle a disagreement that they had last night. kenji argued that fdic and ncusif deposit insurance will cover mutual fund investments as well as insurance policies in the event the firms fail. lucia argued that the programs would not protect these assets. who is right: kenji or lucia? .

Answer 1

Lucia is correct; FDIC and NCUSIF insurance programs cover savings deposits, not mutual fund investments or insurance policies.

Step-by-step explanation:

In the dispute between Kenji and Lucia regarding whether FDIC and NCUSIF deposit insurance will cover mutual fund investments and insurance policies in the event the firms fail, Lucia's argument is correct. The FDIC provides deposit insurance, ensuring that depositors at banks will not lose their savings up to a limit of $250,000 per depositor, per insured bank, for each account ownership category if the bank fails. Similarly, the NCUA protects credit union members by insuring deposits up to the same amount through the NCUSIF. However, these protections do not extend to mutual fund investments or insurance policies; such investments are subject to market risks and not covered by deposit insurance.