Answer:
Commercial banks, required reserve, loans, deposits, create.
Explanation:
The main function of commercial banks is to accept deposits and then to lend the same money (minus required reserves) back out. Banks make a profit by charging a higher interest rate on loans than the interest rate they pay on deposits. Through the loan process, banks are actually able to create money.
The major function of commercial banks is
1. Accepting deposits from people and business organzations.
2. Giving loans to Customers to be paid at a specific period of time at an agreed interest rate.
Required reserve is the minimum amount of money which in required for a commercial Bank to hold/save out of every deposit. If the required reserve is 10% of every deposit, a customer customer deposited $100. The required will be $10 which the bank will hold. The remaining $90 is the balance which banks can loan out to Customers.
Commercial Banks make profit by charging a higher interest rate on loan and lower interest rate on deposits. For example: 7.5% interest rate on loan and 2.5% interest rate on deposits. The 5% difference is the bank Profit.
Suppose there is a decrease in the price of butter.There will be an increase in demand for bread.
<h3>Option (B) is correct</h3>
<u>Explanation:</u>
Bread and butter are complementary goods. They are demanded and consumed together. So their demand are positively correlated which means an increase in demand of one will lead to the same increase the demand of other
If the Price of butter decreases, it will lead to an increase in the demand for butter. With the increasing demand for butter, the demand for bread will automatically increase. Both demands will move in the same direction.
Answer:
Differentiation strategy
Explanation:
This question defines the differentiation strategy. It is an approach which businesses develop whereby they provide their customers with unique and different goods and services than what other competing firms may have to offer in the market. The main goal is to have an advantage increase in the market compared to others.
A down payment is a <span>partial payment given in order to show intent of purchase. When you intend to make a purchase of an item but do not have the means to pay in full or if a full upfront payment is not required, a down payment may be. A down payment can be a set amount or percentage that is agreed upon by the purchaser and the seller for the intent to purchase the item in full. In most cases, there is a contract outlining the partial down payment and then when everything is due in full. </span>
