Asked by James Copper on Jul 02, 2024
Verified
Which of the following is an institution created to facilitate the exchange of checks and drafts drawn by banks on one another, as well as to enable banks to settle their daily balances?
A) A clearinghouse
B) A transferring institution
C) A facilitating institution
D) An acknowledging institution
E) An approval institution
Clearinghouse
An intermediary body that facilitates the exchange of payments, securities, or derivatives transactions among its members.
- Comprehend the positions and obligations of banks in the operation of the check clearing house system.
Verified Answer
PT
Preciousmae Talay Javier6 days ago
Final Answer :
A
Explanation :
A clearinghouse is specifically designed to facilitate the exchange of checks and drafts among banks, allowing them to settle their daily balances efficiently. This process ensures that transactions are completed smoothly and that banks can reconcile their accounts with each other.
Learning Objectives
- Comprehend the positions and obligations of banks in the operation of the check clearing house system.