A bank's 'spread' refers to the:
Anet worth on its balance sheet
Btotal value of its deposits
Cdifference between its lending and deposit interest rates
Dcash reserve ratio it maintains
Answer & Solution
Correct answer: C. difference between its lending and deposit interest rates
The 'spread' is the gap between the higher rate banks charge borrowers and the lower rate they pay depositors; it is the bank's profit.
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