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17. Correspondent banking services would include which of the following?a. Check collectionb. Data processing servicesc. Federal funds tradingd. all of the abovee. a. & c. only18. There is a short-run trade-off between a bank’s liquidity and _______.19. Which of the following could be used to identify a potential increase inborrowing by customers that might deplete a bank’s cash reserves?20. The section of a contingency plan that assesses the impact of potential adverseevents on the bank’s balance sheet is known as the _________ section?21. Vault cash generally satisfies a bank's liquidity needs. False
22. Respondent banks buy services from correspondent banks. True23. More liquid assets tend to earn lower returns, everything else the same. True24. Core deposits tend to be more interest elastic than volatile liabilities. False25. The best measure of bank asset liquidity is the core deposits to total asset ratio. FalseChapter 12The Effective Use of CapitalMultiple Choice1. Banks with greater capital can do all of the following except:a. borrow at lower rates.b. make larger loans.c. expand faster through acquisitions.d. expand faster through internal growthe. Banks with greater capital can do all of the above.2. Community banks are typically considered those banks with assets:3. Prior to the Basle Agreement, primary capital included all of the followingexcept:4. Which of the following was not part of the Basle Agreement?