Which of the Following Statements Is True Concerning Overdrafts

question 77

Multiple Choice

Which of the following statements is true concerning overdrafts?

• A)An effective way to prevent them is to "overload" the account.
• B)They can be avoided by arranging an automatic transfer from a savings account.
• C)They are inexpensive nuisances because banks usually do not charge for overdrafts.
• D)They differ from "bounced checks" in that "bouncing" a check is a mistake while an overdraft is deliberate.

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Definitions:

Appointed

A term referring to individuals who have been selected and assigned roles or positions, often within a governmental or organizational setting, without requiring an election or competitive selection process.

Elected

Refers to the process of choosing or selecting someone to hold a public office or some other position by voting.

Open-Market Operations

Purchases and sales of government securities by the Fed in an effort to influence the money supply.

Government Securities

Government securities are financial instruments issued by a government to raise funds from investors, promising to pay back the borrowed amount with interest, including bonds, treasury bills, and notes.