Which of the Following Is True of Lending by Banks?​

question 79

Multiple Choice

Which of the following is true of lending by banks?​

• A)Banks charge a higher rate of interest on a car loan than a home loan.
• B)Banks increase their prime rate of lending to protect their loans.
• C)Banks require borrowers to put up collateral to reduce the risk of lending.
• D)Banks discount the present value of loans to reduce the risk of lending.
• E)Banks charge lower rates of interest to people with poor credit ratings.

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Definitions:

Ice

Frozen water, a solid state of H2O, typically formed in cold temperatures.

Swelling

An abnormal enlargement of a body part or area due to fluid accumulation or inflammation.

Incomplete Fractures

A type of bone fracture where the bone cracks but does not break all the way through.

Fragments

Small parts or pieces that have broken off from a whole, often resulting from decay, damage, or destruction.