Often Eurodollar Deposits Earn Higher Returns Than U

question 75

Multiple Choice

Often Eurodollar deposits earn higher returns than U.S. bank deposits for all of the following reasons except:

• A) Eurodollar deposits are not subject to U.S. reserve requirements.
• B) the bank does not have to pay deposit insurance premiums on these deposits.
• C) regulatory compliance may be more costly for a foreign bank than a U.S. bank.
• D) taxes on the profits on banks outside the U.S. may be lower on banks inside the U.S.

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Definitions:

Firm's Attention

The focus or priority that a company dedicates to a particular project, issue, or aspect of its operations.

Profit Centers

Divisions or branches of a business that are treated as separate entities for profit calculation and management purposes.

Discretion

The freedom to decide what should be done in a particular situation, often within certain guidelines or rules.

Performance Evaluation

The process of assessing the effectiveness, efficiency, and productivity of an individual, group, or entity.