Investing and Financial Markets Answers

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Bank deposits help the nation’s economy by

p
providing protection for consumers from theft.
g
giving banks the money to loan and invest.
p
providing protection for banks on investments.
g
giving consumers the ability to save money.
3

The Federal Reserve Bank of the United States is also known as the

p
people’s bank.
c
central bank.
w
world bank.
r
retail bank.
5

The main role of banks in the nation’s economy is to

A
store, lend, and invest money.
B
store, lend, and borrow money.
C
store, lend, and distribute money.
D
store, lend, and approve money.
6

Banks pay interest to customers through a

A
savings account.
B
credit card account.
C
mortgage account.
D
401k account.
7

Which is the correct order of entities that benefit when banks make a profit?

A
employees, shareholders, and the economy
B
shareholders, shoppers, and the economy
C
employees, companies, and the economy
D
shareholders, companies, and the economy
9

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

A
Storing and holding money
B
Making purchases to create profits
C
Lending money
D
Investing in the economy
E
Creating money for the economy
10

What explains the difference between retail and commercial banking?

A
Commercial banks loan money to small businesses, while retail banks loan money to large corporations.
B
Retail banks loan money to small businesses, while commercial banks loan money to large corporations.
C
Commercial banks help small businesses make capital purchases, while retail banks help big businesses invest.
D
Retail banks help big businesses make capital purchases, while commercial banks help consumers invest.

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