________ float results from the delay between the time when a customer deducts a payment from the checking account ledger and the time when the vendor actually receives the funds in a spendable form. A) Mail B) Processing C) Collection D) Disbursement ANSWER C
Date: September 19th, 2020
In exchange for the tailor-made maturity date provided by the repurchase agreement, a bank or security dealer provides a return slightly below than obtainable through outright purchase of similar marketable securities. Indicate whether the statement is true or false ANSWER TRUE
Date: September 19th, 2020
Which of the following is true of collection float? A) It represents the time delay between when payment is placed in the mail and when it is received. B) It represents the time between receipt of a payment and its deposit into a firm’s account. C) It results from the lapse between the time when […]
Date: September 19th, 2020
The higher yields on Eurodollar deposits compared with nearly all other marketable securities, governmental or nongovernmental, with similar maturities are attributable to 1. the fact that the depository banks are generally less closely regulated than U.S. banks and are therefore more risky, and 2. some foreign exchange risk may be present. Indicate whether the statement […]
Date: September 19th, 2020
A customer sends payment to a post office box which is emptied by a firm’s bank daily. The bank then processes the payments and notifies the firm of the day’s collections. This collection technique is known as ________. A) a direct send B) concentration banking C) the lockbox system D) controlled disbursing ANSWER […]
Date: September 19th, 2020
Zero-balance accounts are checking accounts in which a zero balance is maintained and the bank automatically covers all checks presented against the accounts. Indicate whether the statement is true or false ANSWER FALSE
Date: September 19th, 2020
Federal agency issues are low-risk securities issued by government agencies but not guaranteed by the U.S. Treasury. Indicate whether the statement is true or false ANSWER TRUE
Date: September 19th, 2020
Eurodollar deposits are deposits of currency that are not native to the country in which the bank is located. Indicate whether the statement is true or false ANSWER TRUE
Date: September 19th, 2020
To be truly marketable, a security must have three basic characteristics: a ready market, risk-free, and safety of principal. Indicate whether the statement is true or false ANSWER FALSE
Date: September 19th, 2020
Marketable securities are short-term, interest-earning, money market instruments that can easily be converted into cash. Indicate whether the statement is true or false ANSWER TRUE
Date: September 19th, 2020
