Checkable and Debitable Accounts in Commercial Banks and Other Financial

question 421

Multiple Choice

Checkable and debitable accounts in commercial banks and other financial institutions are classified as money because

• A) they are not liabilities of the banks.
• B) they sometimes earn an interest income for the depositor.
• C) they are generally acceptable in the payment of debt.
• D) banks hold currency in their vaults equal to the value of demand deposits.

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Definitions:

Rescinds

The act of revoking, canceling, or annulling a contract or agreement.

Consideration

An item of value traded between entities within an agreement to make the contract enforceable by law.

Adhesion

A contract or agreement created by one party with significant power over the other, often leading to a lack of negotiation for the weaker party.

Negotiate Terms

The process of discussing and agreeing on the specific conditions or clauses of a contract or agreement.