Banks minimize the risk of loss to depositors by:

A) lending to government officials.
B) making many different loans to different borrowers.
C) refusing to lend money to the U.S.government.
D) lending to the richest 1 percent of the population.
E) making very long-term loans.

Risk of Loss

The probability or chance that an investment's actual return will be different than expected, including losing some or all the original investment.

Different Loans

A variety of borrowing options available to individuals or entities, each with unique terms, interest rates, and purposes.

Depositors

Individuals or entities that place their money in a financial institution such as a bank, for the purpose of saving or earning interest.