A. the poor needed loans at high interest rates
B. primarily wealthy customers needed loans and deposits
C. the Industrial Revolution demanded new methods of making payments and obtaining credit
D. people needed to protect their savings and wealth from the government
E. All of the options are correct.
70.Early European banks were places for safekeeping of wealth because:
A. loans to the poor often carried high interest rates.
B. loans and deposits were primarily for wealthy customers.
C. the industrial revolution demanded new methods of making payments and obtaining credit.
D. savings and wealth were lost due to war, theft, and expropriation by governments.
E. All of the options are correct.
71.The U.S. government wants to prevent money laundering by drug cartels. To promote this goal, they have asked banks to report any cash deposits greater than $10,000 to the government. Which of the following roles is the bank performing?
A. The intermediation role
B. The payments role
C. The risk management role
D. The guarantor role
E. The policy role
72.The Edmond Wine and Cheese shop wants to buy 30 cases of French Champagne on credit. Bank of America writes a letter of credit stating that the Edmond Wine and Cheese shop is a good risk and that if they do not pay off the loan, Bank of America will. Which of the following roles is the bank performing?
A. The intermediation role
B. The payments role
C. The risk management role
D. The guarantor role
E. The policy role
73.Alexander Phua goes to his local bank and gets an insurance policy that protects him against loss in case he is in a car accident. Which of the following roles is the bank performing?
A. The intermediation role
B. The payments role
C. The risk management role
D. The guarantor role
E. The policy role
74.Chris Jones gets a cashier's check from Wachovia Bank to make his down payment on a new home. Which of the following roles is the bank performing?
A. The intermediation role
B. The payments role
C. The risk management role
D. The guarantor role
E. The policy role
75.The Bank, N.A. accepts deposits from thousands of individuals and lends that money to (among others) the Stillwater Body Shop to expand their work bays. Which of the following roles is the bank performing?
A. The intermediation role
B. The payments role
C. The risk management role
D. The guarantor role
E. The policy role
76.Major trends affecting the performance of financial firms today include all of these except:
A. greater product-line diversification.
B. reduced branching.
C. geographic diversification.
D. convergence.
E. increasing automation.
77.The First National Bank of Lakeland makes risky loans to businesses to expand and grow their businesses while at the same time issuing low-risk securities to their depositors and other fund providers. Which of the following services is this bank offering to their customers?
A. Risky arbitrage services
B. Liquidity services
C. Delegated monitoring services
D. Divisibility of money services
E. Credit services
78.Jonathan Wynn knows that if he wanted to purchase a Treasury Bill, the minimum amount he would spend would be close to $10,000. He also knows that he could deposit $1,000 in a money market deposit account at a bank and earn about the same rate of interest. Jonathan does not have $10,000 to invest in a Treasury Bill. If Jonathan puts his money in the bank, which service that a bank can provide, is he taking advantage of?
A. Risky arbitrage services
B. Liquidity services
C. Delegated monitoring services
D. Divisibility of money services
E. Credit services