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Using the notions of ex ante and ex post interest rates, explain how could a bank be expecting a huge return on its investments and end up with very small real returns?

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Using the notions of ex ante and ex post interest rates, explain how could a bank be expecting a huge return on its investments and end up with very small real returns?

Formula Formula ROI (%) = Net Income Principal Amount × 100

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