Which of the Following Is True of the Banking System

question 66

Multiple Choice

Which of the following is true of the banking system?

• A)Government regulatory authorities limit the loan issuance of banks by imposing reserve requirements.
• B)The predominant liability of virtually all banks is capital stocks.
• C)The difference between a bank's assets and its liabilities constitutes its secondary reserves.
• D)Government regulatory authorities limit the loan issuance of banks by increasing the prime lending rate.
• E)The largest asset item for most banks is time deposits kept by the customers with the bank.

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Definitions:

Liability Coverage

Insurance that provides protection against claims resulting from injuries and damage to people and/or property.

Homeowner's Insurance

A type of property insurance that covers losses and damages to an individual's house and assets in the home.

Business Activities

All actions undertaken by a company as part of its pursuit of profit, including production, sales, and service offerings.

Judgment Creditor

A creditor who has received a legal judgment confirming the debtor owes the creditor money.