The Main Source of Funds for ____ Is Proceeds from Selling

question 19

Multiple Choice

The main source of funds for ____ is proceeds from selling securities to households and businesses, while their main use of funds is providing loans to households and businesses.

• A)savings institutions
• B)commercial banks
• C)mutual funds
• D)finance companies
• E)pension funds

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Definitions:

Fixed Assets

Long-term tangible assets that are used in the operations of a business and are not likely to be converted to cash in the short term.

Warehouse Financing

A form of financing used by banks and other institutions to loan money to companies using inventory as collateral.

Trust Receipt

A trust receipt is a financial document issued by a bank to a buyer who has obtained a loan to purchase goods, where the buyer agrees to hold the goods in trust for the bank until the loan is repaid.

Inventory Loans

Short-term loans or lines of credit secured by a company’s inventory, used to purchase products for sale.