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Questions and Answers
What is a balanced budget?
What is a balanced budget?
- An annual budget with surplus revenues exceeding expenditures
- An annual budget where expenditures perfectly offset revenues
- An annual budget with deficit expenditures exceeding revenues
- An annual budget where revenues perfectly offset expenditures (correct)
What is the primary source of profit for a bank?
What is the primary source of profit for a bank?
- Charging more interest on loans than paid on deposits (correct)
- Issuing new loans at high interest rates
- Investing in government securities
- Service charges on deposits and withdrawals
What does a company do when it accepts deposits and issues new loans?
What does a company do when it accepts deposits and issues new loans?
- Operate as a government entity
- Engage in banking activities (correct)
- Act as a non-profit organization
- Provide insurance services
What happens in a budget with deficit expenditures exceeding revenues?
What happens in a budget with deficit expenditures exceeding revenues?
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How does a balanced budget impact financial stability?
How does a balanced budget impact financial stability?
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