Question 1

_______________________ emerge when financial organization grows in size and is able to reduce its cost of production per unit of output.

Accepted Answer

Economies of scale

Question 2

_________________ is the purchase for resale of new stocks,bonds,and other financial instruments in the money and capital markets on behalf of clients who need to raise new money.

Accepted Answer

Security underwriting

Question 3

Trust department activities usually center upon establishing a ____________ relationship with a customer.

Accepted Answer

fiduciary

Question 4

The trust department can be a significant source of ____________ for a bank or financial holding company.

Accepted Answer

The answer of The trust department can be a significant...

Question 5

A(n)_________________________ is a contract that promises to make a cash payment to the beneficiary in the event of the death of the policy holder.

Accepted Answer

The answer of A(n)_________________________ is a contract that promises to...

Question 6

_________________________ is the bringing together of two or more firms from different industries in order to offer multiple services.

Accepted Answer

The answer of _________________________ is the bringing together of two...

Question 7

Passage of the __________________ of 1999 granted banks,securities firms,and insurance companies the right to apply to the Federal Reserve Board to become financial holding companies (FHCs).

Accepted Answer

The answer of Passage of the __________________ of 1999 granted...

Question 8

When a financial institution offers a(n)__________________ mutual fund,it acts as broker for an unaffiliated mutual fund or group of funds and does not act as an investment advisor.

Accepted Answer

The answer of When a financial institution offers a(n)__________________ mutual...

Question 9

A(n)_________________________ is a contract that promises to reimburse policy holders for personal injury,property damage,and other losses,in exchange for the policy holder's premium payments.

Accepted Answer

The answer of A(n)_________________________ is a contract that promises to...

Question 10

The _________________________ effect brings more than one financial-service industries together to reduce the overall risk of the revenue flows through the company.

Accepted Answer

The answer of The _________________________ effect brings more than one...

Question 11

A(n)_________________________ is a savings instrument in which the customer makes cash payments to an investment manager who invests them in an earning asset.Later the purchaser receives a stream of income from those assets.

Accepted Answer

The answer of A(n)_________________________ is a savings instrument in which...

Question 12

_______________ are financial advisors to corporations,governments,and other large institutions.They advise their clients on issues relating to raising new capital,entering new market areas,etc.

Accepted Answer

The answer of _______________ are financial advisors to corporations,governments,and other...

Question 13

__________________ are one of the earliest services provided by banks and involves the management of customer's property and other assets.

Accepted Answer

The answer of __________________ are one of the earliest services...

Question 14

Under law and industry practice,a __________ is supposed to be set up between an IB's security underwriting and client advising divisions and the internal unit where proprietary trading of stocks and bonds take place,to prevent the transfer of insider information about clients.

Accepted Answer

The answer of Under law and industry practice,a __________ is...

Question 15

The most rapidly growing source of income for banks is ________ income.

Accepted Answer

The answer of The most rapidly growing source of income...

Question 16

A(n)_________________________ gives the bank the right to manage the estate of a living person without a court order.This can be amended by the customer as desired.

Accepted Answer

The answer of A(n)_________________________ gives the bank the right to...

Question 17

When bank purchases stocks,bonds,mutual funds,and annuities on behalf of their customers,these products are referred to as _______________________.

Accepted Answer

The answer of When bank purchases stocks,bonds,mutual funds,and annuities on...

Question 18

A(n)_________________________ promises a customer,who deposits a lump sum,a guaranteed rate of return over the life of the contract.

Accepted Answer

The answer of A(n)_________________________ promises a customer,who deposits a lump...

Question 19

A(n)__________________ fund,is a type of mutual fund offered through a bank's affiliated company.The bank acts as a transfer agent,custodian,and offers investment advice in this type of mutual fund.

Accepted Answer

The answer of A(n)__________________ fund,is a type of mutual fund...

Question 20

_________________________ arise from the potential cost savings that result from being able to use the same management,advertising,and physical resources to offer multiple services.

Accepted Answer

The answer of _________________________ arise from the potential cost savings...

Quiz 14: Investment Banking, insurance, and Other Sources of Fee Income