Purposes of Financial Institutions

Purposes of Financial Institutions

When you put money in the bank, you deposit it.

When you take money out of the bank, ATM, or use a debit card or write a check, you withdraw it.

The amount of money you have in your bank account is the balance.

Banks, credit unions, and savings and loans allow you to borrow money. You have to pay the money back, with interest.

Multiple Choice

Which of the following is NOT a service a bank provides

• It makes loans to other customers.

• Customers can deposit and withdraw money from their accounts

• It provides credit cards for its customers

• Helps you loan money to your friends

Multiple Choice

Which is a good reason to use a Financial Institution?

• Putting your allowance in a safe place

• Lending your friend $5

• The bank will tell you how to spend your money

Multiple Choice

Lucy wants to deposit her weekly allowance into a savings account. What is one good reason to to put her money in a savings account?

• it is hard to withdraw and deposit money into it

• the money can be lost or stolen

• it pays interest

• you must have a lot of money to open a savings account

Multiple Choice

A card that uses money directly from your bank account

• Debit Card

• Credit Card

• Check

• ID card

Multiple Choice

What does the word DEPOSIT mean in regards to money and banks.

• to take money or valuables out of a safe place

• to spend

• to save

• to put money or other valuables in a safe place

Multiple Choice

When you pay back a loan, you not only pay the amount you borrowed, you also pay it back with _____________

• Withdrawal

• Deposit

• Interest

• Checking

Multiple Choice

Which of the following best describes on purpose of financial institutions such as banks, credit unions, and savings and loan associations?

• Lending money to people and businesses

• Keeping money safe

• Both A and B

• Not here

Ms. Venzor's family borrowed $958 to buy a refrigerator. They have to make 12 payments of $91. How much interest do they have to pay?

First multiply

$91 x 12

Next subtract $958 to find the interest charged.

If your answer was

$ 91

x 12

182

910

1,092

Great Job.

1,092

- 958

$ 134

$134 is the interest paid.

Multiple Choice

Guillermo's family borrowed $486 to buy a smart television set. They have to pay $63 interest. They need to make 9 equal monthly payments. How much do they need to pay each month?

• $65

• $61

• $54

• $7

Multiple Choice

Mr. Welch receives a loan from his bank, Chase Bank, to purchase a car. Is the amount he will pay the bank less than, greater than, or equal to the amount he originally borrowed?

• less than

• greater than

• equal to

Multiple Choice

The bank statement below shows what Mr. Triana bought with his credit card. What is the total amount he charged?

03/08/2020 Taco Bell $4.78

03/19/2020 Red Box $5.96

03/24/2020 Home Depot $78.97

• $78.97

• $89.71

• $83.75

• $68.23

Multiple Choice

Dylan deposits $1500 in a 1-year CD (certificate of deposit). He doesn't make any withdrawals during the year. Which could be Dylan's account balance at the end of the year?

• $1,500

• $995

• $1,530

• $30