The Most Important Developments That Have Reduced Banks' Cost Advantages

question 40

Multiple Choice

The most important developments that have reduced banks' cost advantages in the past twenty years include

• A) the growth of the junk bond market.
• B) the competition from money market mutual funds.
• C) the growth of securitization.
• D) all of the above.
• E) only A and B of the above.

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Definitions:

Accrued Expenses

Expenses that have been incurred but not yet paid or recorded through the normal accounting process.

Net Income

The total profit or loss of a business after all expenses, including taxes and operating costs, have been deducted from revenues.

Prepaid Expenses

Costs paid in advance for goods or services to be received in the future, treated as assets on the balance sheet.

Accounts Receivable

Sums due to a company from its clients for products or services that have been supplied or utilized but remain unpaid.