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From course:

Economics A Level (DONEEEEEEE)

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Question:

Why is Risk so Important for the Banking Sector?

Author: eric_galvao



Answer:

-Ceterius Paribus: The More Risker an Asset/Investment is, the Greater Rewards comes out from it -This explains the Different Interest Rates in Different Money Markets. In a more Safer Market, Interest Rates will be Lower -But Banks must always Balance the Risk with the Profitability and the Economic Environment.


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