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Banking- Chapter 10: Specialized Bank Services

Total questions: 14

Worksheet time: 7mins

Name
Class
Date
1.

A financial corporation that is federally chartered and allowed to engage ONLY in international banking.

a)

correspondent bank

b)

Edge corporation

c)

foreign direct investment

d)

the World Bank

2.

An instrument given by a bank on behalf of a buyer to pay back the bank of the seller a given sum in a given time is called a(n)

a)

promissory note

b)

draft

c)

international IOU

d)

letter of credit

3.

The demand for a given currency will be strong if all of the following factors are present EXCEPT

a)

low inflation

b)

low interest rates

c)

a positive trade balalnce

d)

a strong economic forecast

4.

Which of the following is a provision of the Gramm-Leach-Bliley Act?

a)

Banks are prohibited from owning brokerage firms.

b)

Banks are not allowed to sell stock.

c)

Financial services companies are required to have and provide to customers a written privacy policy.

5.

Which of the following bank collection services allows accounts receivable payments to be sent directly to the bank?

a)

zero-balance accounts

b)

automated clearing house network

c)

lockbox service

6.

The practice of buying debt at a discount is called

a)

discounting

b)

investing

c)

financing

d)

factoring

7.

The person who creates a trust is called a...

a)

corpus

b)

donor

c)

beneficiary

d)

maker

8.

Which of the following retirement products allows employees to make tax-deferred contributions, which are often matched by the company, to a trust?

a)

traditional IRA

b)

variable annuity

c)

401(k) plan

d)

ROTH IRA

9.

A debt instrument issued for a period of more than one year with the purpose of raising capital through borrowing is called a(n)

a)

bond

b)

annuity

c)

CD

d)

stock

10.

The _____________ charters and supervises U.S. national banks that do international business.

a)

The Securities and Exchange Commission

b)

The Federal Deposit Insurance Corporation

c)

Office of the Comptroller of the Currency

11.

A _________ bank acts as a point of contact for other banks that do not have a branch in the host country.

a)

commercial

b)

correspondent

c)

edge corporation

12.

_____________ is the practice of depositing, investing, or exchanging money in such a way as to conceal its illegal source.

a)

check fraud

b)

insider trading

c)

money laundering

d)

paperhanging

13.

Accounts ____________________ refers to short-term debt from purchases on credit that must be paid to suppliers of goods or services, typically within 60 days or less.

a)

accounts payable

b)

accounts receivable

14.

_________ is the capital raised by a corporation through the issuance of shares entitling holders to an ownership interest in the corporation.

a)

annuity

b)

bond

c)

mutual fund

d)

stock