Compensating balances

Select one:

a. are created by having a sweep account.

b. generate returns to customers from interest bearing accounts.

c. are used to reward new accounts.

d. are used by banks as a substitute for charging service fees.

A dollar today is worth more than a dollar to be received in the future because

Select one:

a. inflation will increase the purchasing power of a future dollar.

b. None of these options.

c. a stated rate of return is guaranteed on all investment opportunities.

d. the dollar can be invested today and earn interest.