Choose the given statement as true/false:

Banks are willing to lend to all borrowers.

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True

False

answer is B.

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Detailed Solution

The above statement is false.
Banks do not want to lend to people with no collateral or proper documentation, and they may not be prepared to lend to people with a history of defaulting on prior loans. Banks could be reluctant to lend money to business owners that use their funds for riskier endeavours. Gaining additional revenue is one of a bank's primary goals to pay for administrative and other costs, such as the salaries of bank employees. As a result, it must develop prudent loan and investment policies that guarantee a just and predictable return on the money.
The correct statement is that banks lend loans only to borrowers with collateral and proper documentation.

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