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AssignmentMultiple Choice

Economic Growth

Question 1 • 2102320-Economics HONORS - Edgenuity Teacher

When do banks make money from deposits?

Answer
A
when people withdraw money from their account
B
when banks pay interest to account holders
C
when people add money to their account
D
when banks loan the money to another consumer

Explanation

Banks can use deposited money to make loans to other customers and charge interest on those loans. The interest they earn can exceed the interest they pay to depositors, allowing them to make money. Therefore, the correct choice is D, when banks loan the money to another consumer.

AI-written and checked against the verified answer.

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