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    fatin hidayah
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    The document discusses various aspects of banks and lending. It provides multiple choice questions and answers about what is not an example of an informal lender (banks), what banks provide loans for (home, car, education, all of the above), and what banks pay interest on (deposits). Additionally, it covers true/false questions about banks issuing short term liabilities but buying long term assets (true), credit risk being the chance of a borrower defaulting on a loan (true), trade credit not being a system of barter or exchange of credits (false), and firms not needing to pledge collateral for trade credit (false).

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    The document discusses various aspects of banks and lending. It provides multiple choice questions and answers about what is not an example of an informal lender (banks), what banks provide loans for (home, car, education, all of the above), and what banks pay interest on (deposits). Additionally, it covers true/false questions about banks issuing short term liabilities but buying long term assets (true), credit risk being the chance of a borrower defaulting on a loan (true), trade credit not being a system of barter or exchange of credits (false), and firms not needing to pledge collateral for trade credit (false).

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Flag for inappropriate content
    11 views1 page

    Questions

    Uploaded by

    fatin hidayah
    The document discusses various aspects of banks and lending. It provides multiple choice questions and answers about what is not an example of an informal lender (banks), what banks provide loans for (home, car, education, all of the above), and what banks pay interest on (deposits). Additionally, it covers true/false questions about banks issuing short term liabilities but buying long term assets (true), credit risk being the chance of a borrower defaulting on a loan (true), trade credit not being a system of barter or exchange of credits (false), and firms not needing to pledge collateral for trade credit (false).

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Flag for inappropriate content
    of 1

    1. Which of The following is not an example of informal lender?

    a) Banks
    b) Employers
    c) Relative
    d) Friends
    ans: a

    2. Bank provides loans for


    a) Home
    b) Car
    c) Education
    d) All of above
    ans: d

    3. Banks pays interest on


    a) Deposits
    b) Loans
    c) Both (a) & (b)
    d) None of above
    ans: a

    4. Bank charges interest on


    a) Deposits
    b) Loans
    c) Both (a) & (b)
    d) None of above
    ans: b

    1. Bank issue short term liabilities but buy long term assets. (True or False)
    Ans: True

    2. Credit risk is the chance that a borrower will default on a loan by not fully meeting stipulated
    payments on time. (True or False)
    Ans: True

    3. Trade credit is a system of barter or exchange of “credits” instead of cash. (True or False)
    Ans: False. Trade credit is granted from one business to another.

    4. A firm wanting trade credit must pledge collateral. (True or False)


    Ans: False. Trade credit is more flexible than other short-term borrowing, it is not a secured
    loan.

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