When a Bank Takes Savings from Many Small Savers and Lends

question 23

Multiple Choice

When a bank takes savings from many small savers and lends it to many borrowers, the bank:

• A) decreases the risk to savers through diversification.
• B) increases the risk to borrowers through high transaction costs.
• C) decreases the risk to savers through economies of scale.
• D) decreases the return to savers and increases the cost to borrowers.

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Definitions:

Na+ Channels

Protein pores in the membranes of cells that allow the passage of sodium ions (Na+) into or out of the cell, crucial for the initiation and propagation of electrical signals in neurons and muscle cells.

Ca2+ Channels

Protein channels in cell membranes that allow the movement of calcium ions (Ca2+) into or out of a cell, playing critical roles in cellular functions.

Na+ Channels

Specialized proteins in cell membranes that allow sodium ions to enter or leave a cell, playing a key role in generating electrical signals.

SA Node

The sinoatrial node, a group of cells located in the right atrium of the heart that initiates the electrical impulses governing the heart rate, often considered the heart's natural pacemaker.