Secondary Reserves Are So Called Because ________

question 125

Multiple Choice

Secondary reserves are so called because ________.

• A) they can be converted into cash with low transactions costs
• B) they are not easily converted into cash, and are, therefore, of secondary importance to banking firms
• C) 50 percent of these assets count toward meeting desired reserves
• D) they rank second to bank vault cash in importance of bank holdings

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Definitions:

Risk Of Loss

The responsibility for the financial impact of damage, destruction, or disappearance of goods or property, assigned by law or by contract.

F.O.B. Boston

A term indicating that the seller is responsible for goods transportation and risk until the goods are loaded onto a ship in Boston.

Risk Of Loss

Legal term defining which party bears the financial responsibility for damage, destruction, or loss of property, particularly in transactions of goods.

FOB Seattle

A shipping term indicating that the seller's responsibility ends when the goods are placed on board a ship at the Seattle port; the buyer is responsible for freight and risks from that point.