1. Which of the following is not an asset of finance companies?

a. consumer loans

b. business loans

c. real estate loans

d. commercial paper

e. all of the above

2. Which of the following is considered a use of cash in a cash flow statement??

a. Increase in accrued wages?

b. ?Increase in common stock

c. ?Decrease in accounts receivable

d. ?Decrease in inventory

e. ?Increase in fixed assets

3. Which of the following is Fasle?

a. A S&L with high negative asset-liability GAP (i.e repricing gap) might actually do weill in a recession (Hint: Think about what happens to interest rates in recession)

b. In general, commercial banks have a lower concentration of mortgage loans on their balance sheets than S&Ls

c. Other things equal, making more adjustable rate mortgages would help reduce an S&L interest rate risk

d. Credit unions do not pay federal income taxes

e. all of the above statements are true