answersLogoWhite

0

In effect, these are both instances of an institution taking a loan from an individual.

When you put your money into a bank, you are in essence loaning your money to the bank. They pay you interest on the money, and then they loan it out at a higher interest rate and keep the difference. Likewise, when you take out a bond you are in effect loaning your money to the government, which will pay you back with interest at a later time.

User Avatar

Michael Scalise

Lvl 12
4y ago

What else can I help you with?