The way through which bank makes money.

Question

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Answer 1

Question

Chapter P1, Problem 1RQ

To determine

The way through which bank makes money.

Expert Solution & Answer

Explanation of Solution

Banks make money from the following ways:

From loans: Banks make money by providing loans as they earn interests from loans such as auto loans, business loans, personal loans, or mortgages. Banks accept money from depositors and lend the money out to borrowers to earn money by charging a high interest rate on borrowings.
From service fees: Banks also make money by charging non-interest fee for their services such as monthly account fees that bank charges when a depositor opens a bank account. Moreover, bank makes money by charging certain other additional fees such as credit card fees to provide a credit card to customers, custodian fees or brokerage for taking care of customers’ investment, and investment management fees to direct customers’ investments.

Economics Concept Introduction

Introduction: Bank is the financial institution that accept deposits of customers and lend the money to borrowers by charging service fees. Banks offer loans to an individual or business and also provide sales and trading services to business firms.

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Answer 2

Question

Chapter P1, Problem 1RQ

To determine

The way through which bank makes money.

Expert Solution & Answer

Explanation of Solution

Banks make money from the following ways:

From loans: Banks make money by providing loans as they earn interests from loans such as auto loans, business loans, personal loans, or mortgages. Banks accept money from depositors and lend the money out to borrowers to earn money by charging a high interest rate on borrowings.
From service fees: Banks also make money by charging non-interest fee for their services such as monthly account fees that bank charges when a depositor opens a bank account. Moreover, bank makes money by charging certain other additional fees such as credit card fees to provide a credit card to customers, custodian fees or brokerage for taking care of customers’ investment, and investment management fees to direct customers’ investments.

Economics Concept Introduction

Introduction: Bank is the financial institution that accept deposits of customers and lend the money to borrowers by charging service fees. Banks offer loans to an individual or business and also provide sales and trading services to business firms.

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Answer 3

Question

Chapter P1, Problem 1RQ

To determine

The way through which bank makes money.

Expert Solution & Answer

Explanation of Solution

Banks make money from the following ways:

From loans: Banks make money by providing loans as they earn interests from loans such as auto loans, business loans, personal loans, or mortgages. Banks accept money from depositors and lend the money out to borrowers to earn money by charging a high interest rate on borrowings.
From service fees: Banks also make money by charging non-interest fee for their services such as monthly account fees that bank charges when a depositor opens a bank account. Moreover, bank makes money by charging certain other additional fees such as credit card fees to provide a credit card to customers, custodian fees or brokerage for taking care of customers’ investment, and investment management fees to direct customers’ investments.

Economics Concept Introduction

Introduction: Bank is the financial institution that accept deposits of customers and lend the money to borrowers by charging service fees. Banks offer loans to an individual or business and also provide sales and trading services to business firms.

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Answer 4

Question

Chapter P1, Problem 1RQ

To determine

The way through which bank makes money.

Expert Solution & Answer

Explanation of Solution

Banks make money from the following ways:

From loans: Banks make money by providing loans as they earn interests from loans such as auto loans, business loans, personal loans, or mortgages. Banks accept money from depositors and lend the money out to borrowers to earn money by charging a high interest rate on borrowings.
From service fees: Banks also make money by charging non-interest fee for their services such as monthly account fees that bank charges when a depositor opens a bank account. Moreover, bank makes money by charging certain other additional fees such as credit card fees to provide a credit card to customers, custodian fees or brokerage for taking care of customers’ investment, and investment management fees to direct customers’ investments.

Economics Concept Introduction

Introduction: Bank is the financial institution that accept deposits of customers and lend the money to borrowers by charging service fees. Banks offer loans to an individual or business and also provide sales and trading services to business firms.

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Answer 5

Chapter P1, Problem 1RQ

To determine

The way through which bank makes money.

Expert Solution & Answer

Explanation of Solution

Banks make money from the following ways:

From loans: Banks make money by providing loans as they earn interests from loans such as auto loans, business loans, personal loans, or mortgages. Banks accept money from depositors and lend the money out to borrowers to earn money by charging a high interest rate on borrowings.
From service fees: Banks also make money by charging non-interest fee for their services such as monthly account fees that bank charges when a depositor opens a bank account. Moreover, bank makes money by charging certain other additional fees such as credit card fees to provide a credit card to customers, custodian fees or brokerage for taking care of customers’ investment, and investment management fees to direct customers’ investments.

Economics Concept Introduction

Introduction: Bank is the financial institution that accept deposits of customers and lend the money to borrowers by charging service fees. Banks offer loans to an individual or business and also provide sales and trading services to business firms.

Answer 6

Chapter P1, Problem 1RQ

To determine

The way through which bank makes money.

Expert Solution & Answer

Explanation of Solution

Banks make money from the following ways:

From loans: Banks make money by providing loans as they earn interests from loans such as auto loans, business loans, personal loans, or mortgages. Banks accept money from depositors and lend the money out to borrowers to earn money by charging a high interest rate on borrowings.
From service fees: Banks also make money by charging non-interest fee for their services such as monthly account fees that bank charges when a depositor opens a bank account. Moreover, bank makes money by charging certain other additional fees such as credit card fees to provide a credit card to customers, custodian fees or brokerage for taking care of customers’ investment, and investment management fees to direct customers’ investments.

Economics Concept Introduction

Introduction: Bank is the financial institution that accept deposits of customers and lend the money to borrowers by charging service fees. Banks offer loans to an individual or business and also provide sales and trading services to business firms.

Answer 7

Chapter P1, Problem 1RQ

To determine

The way through which bank makes money.

Answer 8

Expert Solution & Answer

Explanation of Solution

Banks make money from the following ways:

From loans: Banks make money by providing loans as they earn interests from loans such as auto loans, business loans, personal loans, or mortgages. Banks accept money from depositors and lend the money out to borrowers to earn money by charging a high interest rate on borrowings.
From service fees: Banks also make money by charging non-interest fee for their services such as monthly account fees that bank charges when a depositor opens a bank account. Moreover, bank makes money by charging certain other additional fees such as credit card fees to provide a credit card to customers, custodian fees or brokerage for taking care of customers’ investment, and investment management fees to direct customers’ investments.

Answer 9

Expert Solution & Answer

Answer 10

Expert Solution & Answer

Answer 11

Economics Concept Introduction

Introduction: Bank is the financial institution that accept deposits of customers and lend the money to borrowers by charging service fees. Banks offer loans to an individual or business and also provide sales and trading services to business firms.

Answer 12

Ch. P1 - Prob. 1RQ Ch. P1 - Prob. 2RQ Ch. P1 - Prob. 3RQ Ch. P1 - Prob. 4RQ Ch. P1 - Prob. 5RQ

The way through which bank makes money.

The way through which bank makes money.

Explanation of Solution

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