a. Explain how finance companies are unique by comparing Fente's net interest income, noninterest income, noninterest expenses, and loan losses to those of commercial banks.
b. Explain why Fente performs better than commercial banks in some periods.
c. Describe the flow of funds channeled through finance companies to firms such as Carson Company. What is the original source of the money that is channeled to firms or households that borrow from finance companies?
Carson Company has sometimes relied on debt financing from Fente Finance Company. Fente has been willing to lend money even when most commercial banks were not. Fente obtains funding from issuing commercial paper and focuses mostly on channeling the funds to borrowers.