When a Bank Sells All or Part of the Cash

question 79

Multiple Choice

When a bank sells all or part of the cash stream from a specific loan,

• A) it removes the loan from its balance sheet.
• B) it usually does so at a loss.
• C) it usually does so at a profit.
• D) both A and B of the above occur.
• E) both A and C of the above occur.

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Definitions:

Sockeye Salmon

A species of salmon found in the North Pacific Ocean, highly valued for its rich, red flesh.

Market Price

The current price at which a good or service can be bought or sold.

Market Price

The selling price of goods or services at which buyers and sellers agree to transact.

Profit

The financial gain realized when the amount of revenue gained from a business activity exceeds the expenses, costs, and taxes needed to sustain the activity.