XYZ Corporation is engaged in lending funds to small vendors in various public markets. To fund the lending, XYZ Corporation raised funds through borrowings from friends and investors. What’s the classification of XYZ Corporation? Bank or Quasi Bank? Explain.
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XYZ Corporation is engaged in lending funds to small vendors in various public markets. To fund the lending, XYZ Corporation raised funds through borrowings from friends and investors. What’s the classification of XYZ Corporation? Bank or Quasi Bank? Explain.
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- Given a financial institution that make money in three ways: interest income, interest income, and investment income, what are some ways a bank can capitalize off of non interest income. Give examples.The term ‘loanable funds' refers to: a. only those funds loaned by one bank to another bank. b. only those funds loaned to banks by the public. c. only those funds loaned to banks by the central bank. d. all those funds changing hands between the lenders and borrowers in the financial markets.3. Uses of commercial bank funds Which of the following are ways that commercial banks use the funds they receive? Check all that apply. Provide working capital loans to support business that don't want to add debt to their balance sheet but still need large amounts of capital for major purchases. Provide term loans to support business that don't want to add debt to their balance sheet but still need large amounts of capital for major purchases. Provide working capital loans to support business' ongoing operations. Engage in repurchase agreements. True or False: The major use for bank funds is real estate loans. True False
- Financial intermediation is not confined to bank lending but is also carried out by nonbank firms such as mutual fund companies. How do mutual funds help overcome information problems in financial markets?Commercial banks obtain funds to make loans from all the following sources except Multiple Choice funds borrowed from the Federal Reserve Bank. money deposited by their borrowers. direct appropriations from the federal government. equity capital of the bank's owners.Secondary Intermediaries are called as such because they depend heavily on other financial intermediaries like commercial banks to loanable funds. Included in this category are finance companies, mortgage banks, and real estate investment trusts. It is true or false?
- Choose the function and service of a bank in which Bank Purchases and sells securities, shares and debentures on behalf of their customers. a. Miscellaneous Functions of the banks b. Discounting of Bills of Exchange c. Investment of Funds d. Agency FunctionsWhat are the main sources of funding for commercial banks?When a bank grants a consumer loan to someone, it leads to: a. an indirect flow of funds O b. a rise in the bank's liabilities Oc a direct flow of funds Od. a rise in the bank's interest expense
- obtain funds by issuing securities and then lend the funds to individuals and small businesses. Finance companies Securities firms Mutual funds Insurance companiesThe financial markets play an important role in channeling funds from savers to borrowers. Which of the following illustrates this function of financial markets? Investors purchase assets like real estate and gold from other investors. Investors purchase capital goods which are used in production by borrowers. Investors deposit funds into interest-bearing accounts which are then loaned to borrowers. Investors purchase securities that are issued by firms and governments.Which of the items below are typically ASSETS for a commercial bank?(Select all that apply; three of the answers below are correct) reference: chapters 11 & 12 Customer Deposits (such as checking & savings accounts) Investment Securities (such as treasury bonds & money market securities) Vault Cash & Deposits at the Federal Reserve Customer Loans (such as mortgages or small business loans) Borrowed Funds (such as short-term borrowing from other banks, or from the Federal Reserve)