BNK601 Quiz 1 Solution and Discussion

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@zaasmi said in BNK601 Quiz 1 Solution and Discussion:

All of the following are included in the financial intermediaries, EXCEPT:

Functions and Examples of Financial Intermediaries. A financial intermediary is a financial institution such as bank, building society, insurance company, investment bank or pension fund. … The bank raises funds from people looking to deposit money, and so can afford to lend out to those individuals who need it.

[cyberian]

@zaasmi said in BNK601 Quiz 1 Solution and Discussion:

Banking companies provide the following services except________________:

Business constancy

[cyberian]

@zaasmi said in BNK601 Quiz 1 Solution and Discussion:

All of the following are demerits of Nationalization of banks, EXCEPT:

Nationalisation of banks aimed at all of the provision of adequate credit, for agriculture and small industry and export only, but not big industries.

[cyberian]

@zaasmi said in BNK601 Quiz 1 Solution and Discussion:

Which of the following refers to “U.S. dollars deposited in foreign branches of U.S. banks or in foreign banks outside the United States”?

Eurodollar

[cyberian]

@zaasmi said in BNK601 Quiz 1 Solution and Discussion:

The strong financial system helps in ---------- the spread between banks lending and borrowing rate.

Spreads in Lending
For any business that lends money, the interest rate spread is what the company charges on a loan compared to its cost of money. A bank runs on interest rate spreads, paying a certain rate on savings and CD deposits and making loans at higher rates than it pays to savers.