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A Compensating Balance: I.is Required When a Firm Acquires Any Bank Financing Other

question 14

Multiple Choice

A compensating balance:
I.is required when a firm acquires any bank financing other than a line of credit.
II.increases the cost of short-term bank financing.
III.may be required even if a firm never borrows funds.
IV.is often used as a means of paying for banking services received.

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