Answer:
The main function of commercial  banks is to accept deposits and then to lend the same money (minus –) reserves back out. Banks make a profit by charging a higher interest rate on loans than the interest rate they pay on deposits. Through the loan process, banks are actually able to multiply  money.
Explanation:
Commercial banks are financial institutions regulated by a central bank that accepts deposits from customers and lends out money for profits.
Reserves are a percentage of customer deposits that commercial banks are required to keep in their vaults.
A loan is money advanced to a customer by lending instruction. It is credit given by banks or lenders to individuals or business consumption or development.
Deposits are the funds that customers save with the banks. It is the money that customers have in the bank accounts.
Money multiplier refers to the proportionate increase in the money supply from an initial deposit. When a customer deposits money, a big percentage is loaned out. The loaned amount will not be consumed at once, which means it will end up in another bank account. Another portion of it will be loaned out again.
The main function of commercial banks is to accept deposits and then lend the same money minus interest back out.
This refers to a financial institution that is in charge of financial transactions and can also lend money to its customers.
Hence, we can note that a commercial bank can lend out money from deposits made by other customers and then charge a higher interest rate and through this, they are able to create money.
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