Question

What are the 2 distinct needs that banks must fill?

Answer 1

Banks must fill two distinct needs: attracting depositors and borrowing funds for lending.

Step-by-step explanation:

Banks must fill two distinct needs:

1. Attracting depositors by guaranteeing to pay them interest on their savings accounts.
2. Borrowing money from other banks or central government-run banks to acquire funds for lending.

In addition, some banks may also make investments in stocks, bonds, and other financial instruments to earn higher rates of return.