🏦 Mango Community Bank & Trust
South Bronx Branch · Est. 2009
While the Cat's Away
A Loanable Funds Simulation · 8 Months
Internal Memo
"I'm going on maternity leave for the next 8 months and I'm leaving you in charge of lending policy. Every month you'll get an economic headline. Your job: figure out where the market for loanable funds is heading, then set our lending rate and loan volume to match.

The right rate and volume means maximum revenue. Too high on the rate and borrowers go to Chase. Too low and we leave margin on the table. Wrong on volume and we're either turning people away or sitting on idle cash.

Our mascot Mango has opinions. Use them as you see fit. 😼"
Carlene, Branch Manager

The interest rate is set where the supply of loans meets the demand for loans. This meeting point is called the equilibrium.

When the economy changes (based on the monthly headline), this equilibrium moves.

Tap the chart to place the new equilibrium. The vertical axis is the interest rate, and the horizontal axis is loan volume. The closer your forecast is, the more revenue the bank earns.

Mango, Bank Mascot
"Set the rate too high, borrowers walk to Chase. Too low, we leave margin on the table. Undershoot volume, we turn people away. Overshoot, idle cash. Overshooting the rate and undershooting the volume hurt more. That's the job."
🏦 Mango Community Bank & Trust
Month 1 of 8
Month 1
Bank Revenue: $0
📰 Economic Headline
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Tap the chart where you forecast the new equilibrium rate will be (where supply and demand will meet) this month.
Monthly Revenue
$0
🏦 Mango Community Bank & Trust
8-Month Review · Carlene is Back
Branch of the Year
Total Bank Revenue
$0
across 8 months · max possible: $4,000,000
👩🏽‍🦱 Carlene wants to know
In one sentence, what was the most valuable lesson learned?
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