Exam 12: Managing and Pricing Deposit Services

According to recent studies cited in this book,in selecting a bank to hold their checking accounts,which of the following factors do household customers rank first?

In general,the longer the maturity of a deposit,the lower the yield a financial institution must offer to its depositors because of the greater interest-rate risk the bank faces with longer-term deposits.

According to recent studies cited in this chapter,the number one factor that households consider in choosing a bank to hold their savings deposit is location.

Deposits are usually priced separately from loans and other bank services.

According to the textbook,one of the reasons why large banks in the recent years have acquired many smaller banking firms is:

A traditional savings account with transactions and balances evidenced by the entries recorded in a booklet kept by the customer is called:

A stable and predictable base of deposited funds that is not highly sensitive to movements in market interest rates and tend to remain with the bank is called:

A customer makes a savings deposit for 15 days.During that time he earns $15 in interest and maintains an average daily balance of $2,200.What is the annual percentage yield on the savings account?

Gradual phase-out of legal interest-rate ceilings on deposits offered by U.S.banks was first authorized by the Glass-Steagall Act.

________________ CDs allow the depositor to withdraw some funds without a withdrawal penalty.

Some people feel that everyone is entitled access to a minimum level of financial service,no matter what their income level is.This issue is called the issue of ________________________.

Which of the following is a reason that has made IRA and Keogh accounts more attractive to depositors recently?

A bank expects to raise $20 million in new money if it pays a deposit rate of 7%,$60 million in new money if it pays a deposit rate of 7.5%,$100 million in new money if it pays a deposit rate of 8%,and $120 in new money if it pays a deposit rate of 8.5%.The bank expects to earn 9.5% on all money that it receives in new deposits.What is the marginal cost of deposits if the bank raises their deposit rate from 7.5% to 8%?

When a customer is charged based on the number and kinds of services used,with the customers that use a number of services being charged less or having some fees waived,this is called __________________ pricing.

A bank expects to raise $20 million in new money if it pays a deposit rate of 7%,$60 million in new money if it pays a deposit rate of 7.5%,$100 million in new money if it pays a deposit rate of 8%,and $120 in new money if it pays a deposit rate of 8.5%.The bank expects to earn 9.5% on all money that it receives in new deposits.What deposit rate should the bank offer on its deposits,if it uses the marginal cost method of determining deposits rates?

Depository institutions selling deposits to the public in the United States must quote the rate of return pledged to the owner of the deposit,which reflects the customer's average daily balance kept in the deposit.This quoted rate of return is known as:

A savings account evidenced only by a computer entry for which the customer gets a monthly printout is called:

The dominant holder of bank deposits in the U.S.:

A customer makes a savings deposit for 60 days.During that time he earns $11 in interest and maintains an average daily balance of $1,500.What is the annual percentage yield on this savings account?

The Federal law that requires U.S.depository institutions to make greater disclosure of the fees,interest rates,and other terms attached to the deposits they sell to the public is called the: