The Toy Store Borrowed $12,000 from the Bank and Agreed

question 170

Multiple Choice

The Toy Store borrowed $12,000 from the bank and agreed to keep $3,000 on deposit at all times. The net result of this compensating balance agreement is that:

• A) the Toy Store actually only borrowed $9,000.
• B) the Toy Store actually only borrowed $3,000.
• C) the actual interest rate is lower than the stated interest rate.
• D) none of the above are true.

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Definitions:

Random Group Assignment

A method used in experiments where participants are randomly assigned to different groups to ensure that each group has a similar composition at the start of the experiment.

Replication Crisis

A methodological issue in psychology and other fields indicating a lack of reproducibility of research findings, challenging the reliability of scientific literature.

Well-known Studies

Famous or widely recognized research projects or experiments in various fields of study.

Consistent Results

Outcomes in research or experiments that are stable and uniform over time or repetitions.