if you lend to the bank would you use the bid rate or ask rate
Added by Alicia K.
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" The bid rate is the interest rate at which the bank is willing to borrow money from you, while the ask rate is the interest rate at which the bank is willing to lend money to you. Show more…
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Suppose you go to your local bank, intending to buy a certificate of deposit with your savings. Explain why you would not offer a loan, at an interest rate that is higher than the rate the bank pays on certificates of deposit (but lower than the rate the bank charges for car loans), to the next individual who enters the bank and applies for a car loan.
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Why might a bank be willing to borrow funds from other banks at a higher rate than the rate at which it can borrow from the Fed?
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