What is the difference between the average interest banks earn on assets and the average interest rate paid on liabilities?
A) spread
B) loss
C) gain
D) change

Question

Quizplus · Accepted Answer

The difference between the average interest banks earn on assets and the average interest rate paid on liabilities is known as the spread. This is how banks make a profit by borrowing money at a lower rate and lending it out at a higher rate, earning the difference in between.

What Is the Difference Between the Average Interest Banks Earn