Which of the following is a role of a bank?

Question

Quizplus · Accepted Answer

Banks accept deposits from savers and use those funds to make loans to borrowers, thereby facilitating the flow of funds from savers to borrowers. This is a fundamental role of a bank. Option A is incorrect because banks do not primarily use funds from capital markets to facilitate borrowing by households. Option B is incorrect because it only focuses on the flow of funds from borrowers to lenders, and ignores the role of savers. Option D is incorrect because while banks can influence interest rates, managing them is primarily the role of central banks.

Which of the Following Is a Role of a Bank