Balances in Foreign Accounts Are Maintained for Purposes of Dealing

question 127

Multiple Choice

Balances in foreign accounts are maintained for purposes of dealing in foreign exchange by:

• A)central banks
• B)correspondents of domestic banks
• C)correspondents or foreign branches of domestic banks
• D)most multinational corporations

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Definitions:

Anchoring Effect

A cognitive bias where an individual relies too heavily on an initial piece of information (anchor) when making decisions.

Anchoring Effect

A cognitive bias where an individual's decisions or estimates are influenced by an initial piece of information (anchor).

Cognitive Bias

A systematic pattern of deviation from norm or rationality in judgment, where individuals create their own "subjective reality" from their perception.

Confirmation Bias

The tendency to search for, interpret, favor, and recall information in a way that confirms one's preexisting beliefs or hypotheses.