Banking

Question 1

Which statement best describes the effects of low and high interest rates on the economy?

Revolt · Accepted Answer

Low interest rates encourage consumers to borrow and spend, while high interest rates encourage saving.

Question 2

Read the graph that displays interest and total payments on a loan.Banks make the most money and take the most risk with an interest rate of

Revolt · Accepted Answer

18 percent.

Question 3

Bank deposits help the nation’s economy by

Revolt · Accepted Answer

giving banks the money to loan and invest.

Question 4

The Federal Reserve manages the nation’s currency and money supply by

Revolt · Accepted Answer

manipulating interest rates and acting as a lender to banks.

Question 5

A responsibility the Federal Reserve has is to

Revolt · Accepted Answer

loan money to banks during a crisis.

Question 6

best

Revolt · Accepted Answer

Interest helps them cover business costs.

Question 7

What types of investments do banks use to make a profit? Check all that apply.opening checking accountsstarting new businessesbuying stocks and bondsbuying several propertiesissuing loans to all customersbuying the rights to loans

Revolt · Accepted Answer

buying stocks and bonds; buying several properties; buying the rights to loans

Question 8

Which are the roles of a bank? Check all that apply.Storing and holding moneyMaking purchases to create profitsLending moneyInvesting in the economyCreating money for the economy

Revolt · Accepted Answer

Storing and holding money; Lending money; Investing in the economy

Question 9

Read the graph that displays mortgage interest rates between 1978 and 1983.In what year did consumers get the best deal on a mortgage?

Revolt · Accepted Answer

1978

Banking Answers

More from this Course

TRY EDGENUITY HACKS