Lines of Credit and Long-Term Relationships Between Banks and Their

Multiple Choice

Lines of credit and long-term relationships between banks and their customers

A) reduce the costs of information collection.
B) make it easier for banks to screen good risks from bad.
C) enable banks to deal with moral hazard contingencies that are neither anticipated nor specified in restrictive covenants.
D) do all of the above.
E) do only A and B of the above.