Final answer:
The primary liabilities of a credit union are C) deposits. They are the funds that members place with the credit union and are owed back to the members.
Step-by-step explanation:
The primary liabilities of a credit union are its members' deposits. Unlike banks, which may invest in a variety of assets including bonds and commercial loans, a credit union's main function is to accept deposits from its members and provide loans back to them. This system of managing deposits and loans reflects the community-oriented nature of credit unions, which are non-profit and owned by their members. The deposits are essentially the money the members entrust to the credit union, and they are recorded as liabilities on the credit union's balance sheet because this is money the credit union owes back to its members. Therefore, the correct answer to the question is C) deposits.