Question

In 2013, Grand Falls Bank (GFB) had $3,895,000 in business loans at an average interest rate of 3.1 percent as well as $3,463,000 in consumer loans with an average rate of 7.1 percent. GFB also has $784,000 invested in government securities that pay interest at an average rate of 2.1 percent. For 2014, GFB estimates that the volume of business loans will increase to $5,618,000, and the interest rate will rise to 4.9 percent. It projects that consumer loans will be $4,205,000 and have an average interest rate of 10.0 percent. The bank's government security investment will be $1,350,000 and will bear an average interest rate of 4.1 percent. What is GFB's projected revenue for 2014?

Please show calculations

Answer 1

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