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How can fractions, percentages, and ratios be applied to solve banking problems?

a. Calculating interest rates and loan terms
b. Analyzing financial statements and ratios
c. Budgeting and financial planning
d. All of the above

1 Answer

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Final answer:

Fractions, percentages, and ratios are essential in banking for calculating interest rates, analyzing financial statements, and budgeting and financial planning.

Step-by-step explanation:

Fractions, percentages, and ratios can be applied to solve various banking problems. They can be used for calculating interest rates and determining loan terms, where a certain percentage of the principal is added over a period as interest. When analyzing financial statements, ratios such as debt-to-equity or current ratio provide insights into a company's financial health and capabilities to meet its obligations. For personal or corporate budgeting and financial planning, understanding these mathematical concepts are fundamental to managing revenues, expenses, investments, and savings effectively. Moreover, interest and risk play a crucial role in allocating savings to its most productive use, as they can determine potential returns and the attractiveness of various investment opportunities.

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