The FDIC Fee System Encourages Depository Institutions to

question 106

Multiple Choice

The FDIC fee system encourages depository institutions to

• A) make riskier loans than they would otherwise.
• B) reject loans that probably would have been profitable.
• C) seek only a modest rate of return.
• D) operate their institutions in too conservative a fashion.

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Definitions:

Residual Income

The net income that an investment earns beyond the minimum rate of return.

Margin

Generally refers to the difference between the selling price and the cost of a product or service, often expressed as a percentage of the selling price.

Customer Service Department

A department in an organization responsible for managing questions, assisting customers with problems, and offering details about the company's products or services.

Operating Divisions

Different sectors or sections within a company that focus on specific operational tasks or business units.