Money Center Banks Differ from Community Banks in All of the Following

question 72

Multiple Choice

Money center banks differ from community banks in all of the following ways except:

• A) they are usually much smaller.
• B) they obtain their funds primarily through borrowing and not by deposits.
• C) they are a much smaller percentage of the total number of banks.
• D) they are actively engaged in the money market.

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Definitions:

Consumption

The action or process of using goods and services for personal, household, or organizational needs.

Marginal Propensity

The proportion of an additional unit of income that is used for consumption; more specifically referred to as the marginal propensity to consume.

Net Wealth

The value of assets minus liabilities.

Consumption Spending

The total value of all goods and services consumed by households within a certain period.