Which of the Following Forms of Compensating Balance Has a Less

question 242

Multiple Choice

Which of the following forms of compensating balance has a less severe effect on the borrower?

• A)Line of credit
• B)Average balance
• C)Minimum balance
• D)Revolving credit

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Definitions:

U.S. Financial Assets

Economic resources or possessions of value owned or controlled by individuals or entities in the United States, including stocks, bonds, and bank deposits.

Living Beyond Its Means

A situation wherein an entity (like a government, company, or individual) spends more money than it receives in income or revenue, leading to debt accumulation.

Foreigners Own

The ownership of domestic assets such as property, companies, or government debt by non-resident individuals or entities.

Balance On Current Account

A measure of a country's international trade where the value of imports and exports of goods, services, and monetary transfers are accounted.