Describe the Assumptions and Characteristics of the Rational Model

question 27

Essay

Describe the assumptions and characteristics of the rational model.

---

Definitions:

Financial Intermediaries

Institutions that act as middlemen in financial transactions, typically between savers and borrowers.

Commercial Banks

Financial institutions that offer a wide range of services to businesses and consumers, including deposit accounts, loans, and money transfers.

Minimum Balance

The smallest amount that must be maintained in a bank account to avoid penalties, such as service charges.

Check-Cashing Services

Financial services where checks can be cashed for a fee without needing a bank account.