The State Bank Offers an Interest Rate of 5

question 119

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 likely outcome of such a situation?

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

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Definitions:

Illness Anxiety Disorder

A chronic condition characterized by excessive worry about having a serious, undiagnosed medical illness despite few or no symptoms.

Psychomotor Retardation

Slowness in motor activity and (apparently) in thought.

Schizophrenia

A mental disorder characterized by distorted thinking, perceptions, emotions, language, self-awareness, and behavior.

Hallucinations

Perceptions or sensations experienced without the presence of external stimuli, typically auditory or visual.