Either Banks Are Too Cautious About Lending to Small Businesses

question 11

Multiple Choice

Either banks are too cautious about lending to small businesses or the Federal Reserve is keeping money from the banks.

• A) 0
• B) 1
• C) 2
• D) 3

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Definitions:

Prepaid Insurance

An asset account that represents insurance payments made in advance for insurance coverage that applies to future periods.

Historical Cost

The original purchase cost of an asset, as recorded in the financial statements, without adjustment for inflation or market changes.

Original Cost

The purchase price of an asset or investment, including all expenses incurred to get the asset ready for its intended use.

Balance Sheet

A financial statement that summarizes a company’s assets, liabilities, and shareholders' equity at a specific point in time.