Test Bank For Investments 11th Edition by
Zvi, Bodie, Alex, Kane Alan, Marcus
Which of the following statements are TRUE?
A) A bank's assets are its sources of funds.
B) A bank's liabilities are its uses of funds.
C) A bank's balance sheet shows that total assets equal total liabilities plus equity
capital.
D) A bank's balance sheet indicates whether or not the bank is profitable. -
Answer-C) A bank's balance sheet shows that total assets equal total liabilities
plus equity capital.
Which of the following statements is FALSE?
A) A bank's assets are its uses of funds.
B) A bank issues liabilities to acquire funds.
C) The bank's assets provide the bank with income.
D) Bank capital is recorded as an asset on the bank balance sheet. - Answer-D)
Bank capital is recorded as an asset on the bank balance sheet.
Which of the following are reported as liabilities on a bank's balance sheet?
A) reserves
,B) checkable deposits
C) consumer loans
D) deposits with other banks - Answer-B) checkable deposits
Because ________ are less liquid for the depositor than ________, they earn
higher interest rates.
A) savings accounts; time deposits
B) money market deposit accounts; time deposits
C) money market deposit accounts; savings accounts
D) time deposits; savings accounts - Answer-D) time deposits; savings accounts
Banks acquire the funds that they use to purchase income-earning assets from
such sources as
A) cash items in the process of collection.
B) savings accounts.
C) reserves.
D) deposits at other banks. - Answer-B) savings accounts.
Bank loans from the Federal Reserve are called ________ and represent a
________ of funds.
A) discount loans; use
B) discount loans; source
,C) fed funds; use
D) fed funds; source - Answer-B) discount loans; source
Which of the following is NOT a source of borrowings for a bank?
A) federal funds
B) Eurodollars
C) transaction deposits
D) discount loans - Answer-C) transaction deposits
Bank capital is equal to ________ minus ________.
A) total assets; total liabilities
B) total liabilities; total assets
C) total assets; total reserves
D) total liabilities; total borrowings - Answer-A) total assets; total liabilities
Bank ________ is/are listed on the liability side of the bank's balance sheet.
A) reserves
B) capital
C) securities
D) cash items - Answer-B) capital
Bank reserves include
, A) deposits at the Fed and short-term treasury securities.
B) vault cash and short-term Treasury securities.
C) vault cash and deposits at the Fed.
D) deposits at other banks and deposits at the Fed. - Answer-C) vault cash and
deposits at the Fed.
The amount of checkable deposits that banks are required by regulation to hold
are the
A) excess reserves.
B) required reserves.
C) vault cash.
D) total reserves. - Answer-B) required reserves.
Which of the following are reported as assets on a bank's balance sheet?
A) borrowings
B) reserves
C) savings deposits
D) bank capital - Answer-B) reserves
Which of the following are NOT reported as assets on a bank's balance sheet?
A) cash items in the process of collection
Zvi, Bodie, Alex, Kane Alan, Marcus
Which of the following statements are TRUE?
A) A bank's assets are its sources of funds.
B) A bank's liabilities are its uses of funds.
C) A bank's balance sheet shows that total assets equal total liabilities plus equity
capital.
D) A bank's balance sheet indicates whether or not the bank is profitable. -
Answer-C) A bank's balance sheet shows that total assets equal total liabilities
plus equity capital.
Which of the following statements is FALSE?
A) A bank's assets are its uses of funds.
B) A bank issues liabilities to acquire funds.
C) The bank's assets provide the bank with income.
D) Bank capital is recorded as an asset on the bank balance sheet. - Answer-D)
Bank capital is recorded as an asset on the bank balance sheet.
Which of the following are reported as liabilities on a bank's balance sheet?
A) reserves
,B) checkable deposits
C) consumer loans
D) deposits with other banks - Answer-B) checkable deposits
Because ________ are less liquid for the depositor than ________, they earn
higher interest rates.
A) savings accounts; time deposits
B) money market deposit accounts; time deposits
C) money market deposit accounts; savings accounts
D) time deposits; savings accounts - Answer-D) time deposits; savings accounts
Banks acquire the funds that they use to purchase income-earning assets from
such sources as
A) cash items in the process of collection.
B) savings accounts.
C) reserves.
D) deposits at other banks. - Answer-B) savings accounts.
Bank loans from the Federal Reserve are called ________ and represent a
________ of funds.
A) discount loans; use
B) discount loans; source
,C) fed funds; use
D) fed funds; source - Answer-B) discount loans; source
Which of the following is NOT a source of borrowings for a bank?
A) federal funds
B) Eurodollars
C) transaction deposits
D) discount loans - Answer-C) transaction deposits
Bank capital is equal to ________ minus ________.
A) total assets; total liabilities
B) total liabilities; total assets
C) total assets; total reserves
D) total liabilities; total borrowings - Answer-A) total assets; total liabilities
Bank ________ is/are listed on the liability side of the bank's balance sheet.
A) reserves
B) capital
C) securities
D) cash items - Answer-B) capital
Bank reserves include
, A) deposits at the Fed and short-term treasury securities.
B) vault cash and short-term Treasury securities.
C) vault cash and deposits at the Fed.
D) deposits at other banks and deposits at the Fed. - Answer-C) vault cash and
deposits at the Fed.
The amount of checkable deposits that banks are required by regulation to hold
are the
A) excess reserves.
B) required reserves.
C) vault cash.
D) total reserves. - Answer-B) required reserves.
Which of the following are reported as assets on a bank's balance sheet?
A) borrowings
B) reserves
C) savings deposits
D) bank capital - Answer-B) reserves
Which of the following are NOT reported as assets on a bank's balance sheet?
A) cash items in the process of collection
