An asset category that caries the highest interest rate is
A) loans.
B) checkable deposit accounts.
C) savings deposits.
D) cash in the bank vault.

Question

Quizplus · Accepted Answer

Loans typically carry a higher interest rate than other asset categories because they involve a higher level of risk for the lender. The interest rate is the compensation for the risk taken by the lender. Checkable deposit accounts and cash in the bank vault typically don't earn any interest, while savings deposits may earn interest but at a lower rate than loans.

An Asset Category That Caries the Highest Interest Rate Is