A Bank with Fluctuating Deposit Liabilities in a Static Community

question 179

True/False

A bank with fluctuating deposit liabilities in a static community will tend to follow creative banking practices when approving loans.

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Definitions:

LLP

Stands for Limited Liability Partnership, a legal structure that offers some of the benefits of a partnership while limiting personal liability of the partners.

Asset Distribution

The process of allocating assets, either during a person’s life or after death, according to the person's wishes or legal agreements.

Profitable

Describes a situation, venture, or entity that generates more revenue than the expenses incurred, resulting in financial gain.

Capital Account

In finance, a record of the financial transactions and investments between residents of a country and the rest of the world.