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As Financial Intermediaries,commercial Banks Pay Their Expenses and Earn a Profit

Question 56

Multiple Choice

As financial intermediaries,commercial banks pay their expenses and earn a profit by


A) paying depositors a higher interest rate than they charge borrowers.
B) paying depositors a lower interest rate than they charge borrowers.
C) earning interest from their deposits at the Federal Reserve.
D) investing funds from stockholders in the stock and bond markets.
E) investing funds from depositors in the stock and bond markets.

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