In General,banks Would Prefer to Acquire Funds Quickly by ________

question 41

Multiple Choice

In general,banks would prefer to acquire funds quickly by ________ rather than ________.

• A)reducing loans;selling securities
• B)reducing loans;borrowing from the Fed
• C)borrowing from the Fed;reducing loans
• D)"calling in" loans;selling securities

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Definitions:

Debt-Equity Ratio

A ratio indicating the finance strategy of mixing shareholders' equity and debt for asset acquisition.

Profit Margin

A financial performance metric that indicates the percentage of revenue that remains as profit after accounting for costs and expenses.

Sustainable Rate Of Growth

The maximum rate at which a company can grow its sales and earnings without increasing its financial leverage or debt.

Retention Ratio

The retention ratio is a financial metric indicating the percentage of a company's earnings that are not paid out as dividends but are reinvested back into the business.