Which of the Following Statements About an Overdraft Facility Is

question 52

Multiple Choice

Which of the following statements about an overdraft facility is NOT correct?

• A) Banks require an overdraft facility to be operated on a fully fluctuating basis.
• B) Generally, the agreed interest rate on an overdraft is calculated by the bank on the balance at the end of the month.
• C) The bank lender will charge an establishment fee to cover the establishment costs of an overdraft.
• D) There is an unused limit fee that is much less than the actual overdraft interest rate.

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Definitions:

Entrepreneur

An individual who starts, organizes, manages, and assumes the risks of a business or enterprise.

Small Companies

Organizations with a limited number of employees and revenue, often characterized by a narrow market focus.

Microloans

Small-business loans often used to buy equipment or operate a business.