How do financial institutions provide finances for firms? ​

Sagot :

Answer:

Finance companies get money by selling securities, mostly commercial paper, in the money market to other businesses, including banks, and then lend the money out to individuals or businesses at a higher interest rate than what they pay on their securities

Answer:

By inviting investors to invest in their institution, the money lent to them will be used in the circulation, promising the investors an interest in their investment, while still getting enough interest from the firms to make the institution run.