Interest rates upon residential mortgages of next to risk were 5.5% in California as well as 7.0% in New York. Could this differential persist? What forces competence lend towards to equate rates? Would differentials in borrowing costs for businesses of next to risk located in CA or NY be some-more or reduction expected to exist than differentials in residential debt rates? Would differentials in the price of income for NY as well as CA firms be some-more expected to exist if the firms being compared were really vast or if they were really small? What have been the implications of all this with apply oneself to national branching?
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money flows till it is equal for equal risk………..homework