The Development of Foreign Banking Activities in the 1960s Was

question 69

Multiple Choice

The development of foreign banking activities in the 1960s was prompted by all of the following U.S. regulations that restricted U.S. capital flows abroad except:

• A) Foreign Direct Investment Program (FDIP)
• B) Agricultural Export Restraint Program (AERP)
• C) Interest Equalization Tax (IET)
• D) Voluntary Foreign Credit Restraint program (VFCR)

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Definitions:

Economic Profit

The distinction between aggregate income and comprehensive charges, covering both manifest and inferred expenses.

Opportunity Cost

The value of the best alternative foregone when making a decision.

Equity Capital

Funds raised by a company through the sale of stock in the company, representing ownership interests in the corporation.

Economic Profit

The total revenue of a business minus both its explicit costs (like wages and materials) and its implicit costs (like opportunity costs), reflecting the true financial gain.