A Compensating Balance Arrangement Between a Firm and Its Bank

question 163

Multiple Choice

A compensating balance arrangement between a firm and its bank:

• A)increases the return on the loan to the bank.
• B)forces the firm to keep a minimum balance in its checking account.
• C)increases the cost of the loan to the firm.
• D)All of the above

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Definitions:

Social Schemas

Frameworks or cognitive structures that help individuals organize and interpret information about the social world according to categories and rules.

Prejudice

An unjustified or incorrect attitude (usually negative) towards an individual based solely on the individual's membership of a social group.

Internal Attribution

Refers to the process of assigning the cause of behavior to some characteristic within the individual, such as personality, disposition, or attitude.

External Attribution

The process of attributing the cause of one's own or others’ behavior to factors outside the person, such as the social or physical environment.