A Primary Advantage for a Depository Institution of Belonging to the Federal

question 14

Multiple Choice

A primary advantage for a depository institution of belonging to the Federal Reserve System is

• A)direct access to correspondent banking services.
• B)the lower deposit reserves required under the Federal Reserve System.
• C)direct access to the discount window of the Fed.
• D)commission less trading of U.S.government securities.
• E)decreased costs of regulatory compliance.

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Definitions:

Independent Projects

Projects that can be accepted or rejected individually.

IRR

A capital budgeting tool, the Internal Rate of Return calculates the anticipated profit percentage of prospective investment projects.

Straight-Line Method

A depreciation accounting method that allocates the cost of a fixed asset evenly over its useful life.

Salvage Value

The estimated resale or scrap value of an asset at the end of its useful life, considered in depreciation calculations.