A Non-Bank Bill May Be More Difficult to Discount Than

question 38

Multiple Choice

A non-bank bill may be more difficult to discount than a bank bill because:

• A)the interest rate is recalculated each time a new bill is issued.
• B)bank bills are regarded as inferior quality.
• C)there is a cost associated with the bill facility.
• D)the financial stature of the acceptor or endorser is not well regarded.

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Definitions:

Price Level

The economy's wide-ranging average of prices for every produced good and service.

Price Level

An index of the average price of goods and services in an economy over a period, indicating inflation or deflation.

Exchange-Rate Effect

The impact of changes in the relative value of currencies on the economy, affecting import and export prices, investment flows, and overall economic performance.

Aggregate Demand

The full volume of demand for goods and services in an economy, priced at a particular level, within a designated period.