The Most Important Developments That Have Reduced Banks Cost Advantages

question 58

Multiple Choice

The most important developments that have reduced banks cost advantages in the past thirty years include:

• A) the growth of the junk bond market.
• B) the competition from money market mutual funds.
• C) the growth of securitization.
• D) the growth in the commercial paper market.

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Definitions:

Depreciation Expense

The allocation of the cost of a tangible asset over its useful life, reflecting the decrease in value over time.

Accounts Receivable

Accounts receivable refers to the money owed to a business by its customers for goods or services delivered on credit but not yet paid for.

Net Income

A metric indicating the amount of earnings left after the subtraction of all expenses, including taxes and operating expenses, reflecting a company's profitability.

Inventory

Items held for sale in the ordinary course of business, as well as supplies and raw materials intended for use in producing goods for sale.