The Required Compensating Balance Is Usually Computed as a

question 45

Multiple Choice

The required compensating balance is usually computed as a

• A) percentage of the customer's loans outstanding.
• B) factor of accounts receivable.
• C) percentage of the bank's commitments toward future loans to the customer.
• D) percentage of the customer's loans outstanding or percentage of the bank's commitments toward future loans to the customer.

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Definitions:

Apparent Authority

A form of authority that an agent appears to have to a third party because of the behavior or statements of the principal, even if the actual authority was not granted.

Actual Notice

Knowledge of a fact acquired directly through firsthand experience or communication, not through inference or assumption.

Breach of Contract

The violation of a contractual obligation without valid legal excuse, which may result in legal consequences including the right to damages or enforcement of performance.

Unidentified Principal

Refers to a scenario in agency relationships where the identity of the principal is unknown to the third party at the time of the transaction.