Which of the Following Indicates the Potential for Deposits Leaving

question 34

Multiple Choice

Which of the following indicates the potential for deposits leaving a bank?

• A) High business activity and growth
• B) Deposits that are inelastic to changes in interest rates
• C) An aggressive bank loan officer
• D) Large deposits held by a single customer
• E) Small unused commercial credit lines outstanding

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Definitions:

Pretax Income

The amount of income that a company earns before any taxes are deducted.

Variable Cost

Costs that vary in direct proportion to changes in the level of production or sales activity.

Fixed Costs

Costs that do not fluctuate with the level of production or sales activity, such as rent, salaries, and insurance premiums, remaining constant regardless of business volume.

Break-Even

The point at which total revenues equal total costs, leading to neither a profit nor a loss.