The State Bank Offers an Interest Rate of 5

question 90

Multiple Choice

The State Bank offers an interest rate of 5.5% on savings and 6% on loans, while the Colonial Bank offers 6.5% on savings and 7% on loans. Which of the following is the LEAST likely outcome of such a situation?

• A) The State Bank would experience a surge in demand for loans.
• B) The Colonial Bank would experience a surge in demand for deposits.
• C) The State Bank would experience a fall in demand for deposits.
• D) The Colonial Bank would experience a surge in demand for loans.

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Definitions:

Probability

A measure of the likelihood of an event happening, expressed as a number between 0 and 1.

Response

A reaction by an organism or system to a specific stimulus or situation.

Quality of Reinforcement

Refers to how effective a reward or punishment is in strengthening or weakening a behavior.

Performance

The manner in which something or someone functions, operates, or behaves.