20. The Federal Deposit Insurance Corporation insures all bank liabilities against default.
21. The Securities Exchange Commission (S.E.C.) was set up by Congress in the 1930s to make sure that small investors make appropriate investments.
22. If a loan is an amortizer, the bank must lend additional funds to the borrower if and when she requests it.
23. Certificates of Deposit are a type of time deposit
24. You can buy a company’s stock when the company issues shares in the primary market or when an existing investor sells his/her shares in the secondary market.
25. ABC Company has cash on its balance sheet. It decides to use the cash to purchase equipment. Compared to the original situation, ABC’s leverage ratio is higher.
26. The Net Asset Value of an open-end mutual fund never changes.
27. When you deposit your salary into your checking account, you are lending money to the bank.
28. An underwriter is the corporation’s secretary. He/she signs his/her name on all corporate documents directly under the president’s signature.
29. Compensating balances refer to the compensation a bank pays to its corporate clients for holding deposits at the bank. Get Finance homework help