In Which of the Following Ways Can a Bank Acquire

question 13

Multiple Choice

In which of the following ways can a bank acquire liquidity?

• A) Selling Fed funds
• B) Investing in repurchase agreements
• C) Increasing the number of loans outstanding
• D) Selling Treasury securities
• E) Buying back outstanding bank stock

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Definitions:

Voting Trust Agreement

A legal agreement where stockholders transfer their shares to a trustee in exchange for voting trust certificates, allowing the trustee to vote on corporate matters.

Cumulative Voting Agreement

An arrangement that allows shareholders in a company to pool their votes towards electing directors, enhancing the voting power of minority shareholders.

Good Faith

Honesty in fact and observance of reasonable commercial standards of fair dealings in the trade.

Boards of Directors

Groups of elected or appointed members who jointly oversee the activities of a company or organization, making strategic decisions and ensuring legal compliance.