babitakhapangi6340 babitakhapangi6340

21-01-2021
Business

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A restriction of cash wherein the borrower is required to maintain a specific amount in a low-interest or noninterest-bearing account at the bank is called

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ewomazinoade ewomazinoade

25-01-2021

Answer:

Compensating balance

Explanation:

Compensating balance is when the borrower agrees to maintain an amount of cash in his account.

The lender can invest this money and this reduces the cost of borrowing

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