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:

Specified Term

A specified term refers to a fixed or clearly defined period or condition detailed in a contract or agreement.

Absolute Tenancy

A type of property lease where the tenant possesses total and unrestricted rights to the property for the lease period.

Type Of Lease

Refers to the different kinds of leasing agreements available, such as operational leases, finance leases, and capital leases, each with its specific terms and conditions.

Covenant Of Quiet Enjoyment

A promise that a tenant has the right to quietly enjoy the land.