Which of the following statements is true about banks? (Choose an answer from the list below; only one is correct.) Reference: Chapter 11 and/or slides for class discussion. Group of answer choices They hold ALL of their customers deposits in the form of cash or government bonds. They are NOT allowed to set the interest rates at which they lend, interest rates on products like mortgages are set by the Federal Reserve or by another of their regulators. They act as an intermediary for borrowers and savers by taking in DEPOSITS and using them to make LOANS. They are owned and operated by the government and are not permitted to make a profit
Mortgages
A mortgage is a formal agreement in which a bank or other financial institution lends cash at interest in return for assuming the title to the debtor's property, on the condition that the obligation is paid in full.
Mortgage
The term "mortgage" is a type of loan that a borrower takes to maintain his house or any form of assets and he agrees to return the amount in a particular period of time to the lender usually in a series of regular equally monthly, quarterly, or half-yearly payments.
Which of the following statements is true about banks?
(Choose an answer from the list below; only one is correct.)
Reference: Chapter 11 and/or slides for class discussion.
They are NOT allowed to set the interest rates at which they lend, interest rates on products like mortgages are set by the Federal Reserve or by another of their regulators.
They are owned and operated by the government and are not permitted to make a profit.
Financial Institutions
A company that is engaged in financial transactions is known as a financial institution. The main functions undertaken by financial institutions are accepting deposits, making investments, granting loans, etc.
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