Banks that offer low interest rates to people with good credit

The options of the question are, A) maximize profits at little risk. B) sacrifice profits for less risk. C) maximize profits at great risk. D) sacrifice profits to more risk.

The correct answer is B) sacrifice profits for less risk.

Banks that offer low-interest rates to people with good credit, sacrifice profits for less risk .

When a person borrows money, he/she has to pay interest. When a loan is granted with a low-interest rate it has more probability to be paid due to the less interest the individual has to pay monthly. This kind of loan is better for the people and have less risk. The Bank calculates the amount of the loan taking into consideration the credit score of the person. That is why Banks that offer low- interest rates to people with good credit, sacrifice profits for less risk.

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