Chapter 3The Organization and Structure of Banking and the Financial-Services IndustryFill in the Blank Questions1.A(n) _ is a machine located at the merchants place of business which allows depositors to use their debit card to pay for purchases directly. Answer: POS 2.A(n) _ is a bank which offers its full range of services from several locations. Answer: branch bank 3.A(n) _ is a bank which offers its full range of services from only one location. Answer: unit bank 4.A(n)_ is a corporation chartered for the express purpose of holding the stock of one or more banks. Answer: Bank Holding Company 5.Managers who value fringe benefits, plush offices and ample travel budgets over the pursuit of maximum returns for stockholders are exhibiting signs of _. Answer: Expense Preference Behavior 6. A(n) _ can invest in corporate stock as sell as loan money to help finance the start of new ventures or support the expansion of existing businesses. Answer: Merchant bank 7.A bank which operates exclusively over the internet is known as a _ bank. Answer: Virtual 8.One new 21st century bank organizational structures is _ . This is a special type of holding company that may offer the broadest range of financial services.Answer: Financial Holding Company (FHC) 9. The key problem in a large money center bank is . Managers may be knowledgeable about banking practices but may be less informed about products and services of subsidiary companies.Answer: span of control10. The Gramm-Leach-Bliley Act moved the U.S. banking industry closer to banking in which banks may provide securities, insurance, and other financial products.Answer: universal11. A bank that is not associated with a bank holding company is called a(n) bank.Answer: independent12. is a view of how modern corporations operate which analyzes the relationship between a firms owners and its managers.Answer: Agency theory13. Many experts believe that , the relationships that exist between managers, the board of directors and stockholders, is more complicated in financial institutions. Answer: Because of government regulations.14. is the idea that there will be a lower cost of production per unit as the firm gets larger.Answer: Economies of scale15. is the idea that there will be lower cost of producing multiple services using the same organization and resources.Answer: Economies of scope16. Over the years, managers of banks and other financial institutions have evolved different organizational forms to address changes in the industry. Indeed, these firms are organized to carry out various roles in the most efficient way. This is referred to as _.Answer: Organizational form follows functionTrue/False QuestionsTF17.Bank size is not considered a significant factor in determining how banks are organized. Answer: False TF18.Nearly three quarters of all U.S. banks exceed $100 million in asset size apiece. Answer: False TF19.Nearly all U.S. banks with federal or state charters have their deposits insured by the Federal Deposit Insurance Corporation. Answer: True TF20.State-chartered banks in the United States represent about a quarter of all U.S.-chartered banks, while national banks account for approximately three quarters of all U.S. chartered banks. Answer: False TF21.The majority of all U.S. banks are members of the Federal Reserve System. Answer: False TF22.A banking corporation chartered by either federal or state governments that operates only one full-service office is called a unit bank. Answer: True TF23.Over half of all U.S. states today limit branching activity.Answer: False TF24.The average U.S. bank is larger in size (in terms of number of branch offices) than the average Canadian bank. Answer: False TF25.Despite the rapid growth of automation in U.S. banking, there are more full-service branch banking offices than automated teller machines across the whole U.S. Answer: False TF26.In the United States there are more one-bank holding companies than multi-bank holding companies. Answer: True TF27.Bank holding companies hold more than 90 percent of the industrys assets in the United States. Answer: True TF28.Research evidence suggest