Question

Can someone please?
Margaret loans her money to a corporation with the promise of being paid back her loan amount plus interest in three years. Margaret most likely invested in a ____.


stock


bond


mutual fund


investment portfolio

Blackshear Bank offers a 7% interest rate on loans, but only offers a 2% interest rate on deposits. Which of the following is the most likely reason for this spread in interest rates?


Blackshear Bank is a for-profit business and therefore must charge more interest on loans to be able to pay interest on deposits and still make money.


Blackshear Bank does not want its customers to be happy so they do not give them high interest on their deposits.


Blackshear Bank thinks that charging lower rates on deposits is the best way to attract customers.


Blackshear Bank just makes up interest rates based on weekly lottery numbers.

Answer 1

1. The answer is bonds. This is a loan security, in which the issuer is indebted the holders a loan and (contingent on the terms of the bond) is indebted to pay them interest (the coupon) or to reimburse the money at a later date, also known as the maturity date.2. The answer is Blackshear Bank is a for-profit business and therefore must charge more interest on loans to be able to pay interest on deposits and still make money. When you deposit money in a bank, you essentially offer that money to the bank and get interest. When you loan money, you pay interest in discussion for by means of someone else’s money.

Answer 2

Answer:

The answer is bonds. 2 The answer is Blackshear Bank is a for-profit business and therefore must charge more interest on loans to be able to pay interest on deposits and still make money.