Which of the Following Allow Banks to Minimize the Cost

question 512

Multiple Choice

Which of the following allow banks to minimize the cost to a business of borrowing?
I. Borrowing long and lending short.
II. Raising funds from a large number of depositors.
III. Creating money by lending all their reserves.

• A) I and III
• B) II only
• C) I only
• D) II and III

Appreciate the importance of effective control processes and measurements for organizational success.

Understand the control process steps and the principles of management by exception.

Understand the components and purposes of various financial statements such as the Statement of Cash Flows and the Balance Sheet.

Recognize the categorization of cash flows in the Statement of Cash Flows.

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Definitions:

Theory

An organized collection of thoughts aimed at clarifying something, established on broad principles that are not derived from the phenomenon being clarified.

Fear Arousal

The process of inducing a state of fear in an individual, often used in psychological experiments or therapies.

Persuasive Tactic

Strategies or methods employed to convince or influence others to adopt a certain belief or follow a course of action.

Negative Consequences

Unfavorable or harmful outcomes resulting from an action, condition, or behavior.