When a customer deposits money in a bank account, this deposit represents:
a) a liability for the customer and an asset for the bank.
b) an asset for both the bank and the customer.
c) a liability for the customer and the bank.
d) a liability for the bank and an asset for the customer.
Ans: d) a liability for the bank and an asset for the customer.
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Suppose a lawyer leaves his $50,000-a-year job and starts his own firm breeding pit bulls. In the first year, his accounting profit is $70,000 . The lawyer finances his new business with $100,000 from his savings account, which had earned 10 percent interest. His economic profit is
a. $10,000 b. $60,000 c. $70,000 d. -$80,000 e. -$90,000
The Carters' oldest son attends Big State University. He and his parents pay all his fees and tuition. These payments count in GDP as
a. investment. b. government spending. c. consumption of services. d. consumption of durable goods.