Which of the Following Is Not a Factor That May

question 41

Multiple Choice

Which of the following is not a factor that may tend to increase loan sales in the future?

• A) There is an increased trend to apply credit ratings to loans offered for sale, increasing the attractiveness to secondary market purchasers.
• B) Because of their special credit monitoring skills, FIs have a comparative advantage in making loans to below-investment grade companies and then selling the loan.
• C) The trend toward marked-to-market accounting for assets makes bank loans more like securities so they may be easier to sell.
• D) The risk-based capital requirements of the Bank for International Settlements give banks a strong incentive to sell housing loans to decrease their amount of risky assets.

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Definitions:

Substitute Resources

Alternate resources or inputs that can be used in place of one another in the production process, often leading to competition between them.

Skilled Craft Workers

Individuals who are trained to perform specialized tasks or crafts, often requiring manual prowess and specific training.

Industrial Unions

Labor unions organizing all workers in an industry under one association, no matter the job each worker performs.

Craft Unions

Labor unions that represent workers specialized in particular crafts or trades, focusing on skills and qualifications rather than the industry or sector.