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Functions of Financial Institutions

Functions of Financial Institutions

Assessment

Presentation

Social Studies

9th - 12th Grade

Hard

Created by

Joseph Anderson

FREE Resource

11 Slides • 15 Questions

1

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12.01: Financial
Institutions

Source: pixabay.com

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Objective

Students will be able to....

compare the types of financial institutions and evaluate
which might be best in different situations

evaluate services and related costs associated with
personal banking

3

Open Ended

What are the names of some banks that you know about?

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Different types of Banks

1. Commercial

Banks

2. Credit Unions
3. Savings and

Loans

Source: pixabay.com

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Commercial Banks

Most services (checking,
savings, loans, credit cards)

For-profit, not owned by
members

Savings insured by FDIC
Examples:

Wells Fargo, Chase, Bank of
America, etc.

6

Multiple Choice

Question image

Financial institutions act as intermediaries between borrowers and savers by receiving deposits and making loans. Financial institutions encourage saving by paying _____ on deposits.

1

Interest

2

Loans

3

Dividends

4

Savings

7

Multiple Choice

A ____ is a financial intermediary that accepts deposits, makes loans, and offers checking accounts.

1

bank

2

payday lender

3

federal reserve

4

brokerage firm

8

How do they make money?

interest charged > interest earned


Banks and other finanical institutions loan the money that we give them to other people at a higher rate other people

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Credit Unions

Many services (checking, savings,
loans, sometimes credit cards)

Non-profit, owned by members

Often offers better rates

Savings insured by NCUA
Examples:

Navy Federal, PenFed, Virginia,
Apple Federal

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Savings and Loans

Only savings & loans
(mortgages)

Usually local, kind of dying

For-profit, can be owned by
members

Savings insured by FDIC
Examples:

11

Match

Match the following

If you need help, look at the last slide.

Bank

Credit Union

Savings and Loan Association

Internet Bank

A business that offers financial services to make a profit.

A financial institution owned and controlled by members with profits invested to benefit members

A financial institution that offers interest on savings and lends money for home mortgage loans.

These banks can offer better interest rates because they don't have a physical location to rent.

12

Multiple Choice

Question image

Which of the following are intermediaries between people who save money and people who borrow money?

1

Political candidates

2

Government officials

3

Banks, credit unions, financial institutions

4

Schools or colleges

13

Multiple Select

Private financial institutions include (check ALL that apply):

1

Federal Reserve

2

Savings & Loans

3

Credit Unions

4

Loans "R" Us

5

Banks

14

Multiple Choice

Examples of these types of banks are Wells Fargo, Chase, and Regions

1

commercial banks

2

credit unions

3

charters

15

Multiple Choice

an independent agency created by the federal government to protect bank customers by insuring their deposits

1

Federal Deposit Insurance Corporation

2

Financial Depository Insurance Company

3

Financial Department of Insurance Corporation

16

Multiple Choice

a non profit financial cooperative owned by and operated for the benefit of its members; services offered only to its members

1

credit union

2

commercial bank

3

savings and loans associations

17

Multiple Choice

Malcolm is a busy executive who uses his time wisely. He wants a bank that can process his paycheck automatically, pays high interest and is open 24/7.

What kind of financial institution would you recommend and why?

1

Internet Bank: always available, offers competitive interest rates and automatic check deposits

2

Credit Union: locally run, offers business services and loans

3

Bank: easily accessible, helpful staff at local branches, online services

4

Savings and Loan: focused on real estate financing, locally run, insured by government

18

Multiple Choice

Maria and Martin are opening a new business and want a secure local bank that can process their loan and offer them other services for their business.

What kind of financial institution would you recommend and why?

(Look for a key word!!!)

1

Internet Bank: always available, offers competitive interest rates and automatic check deposits

2

Credit Union: locally run, offers business services and loans

3

Bank: easily accessible, helpful staff at local branches, online services

4

Savings and Loan: focused on real estate financing, locally run, insured by government

19

Multiple Choice

Jose and Juanita are buying their first home. They want a low interest rate on loans and want to deal with someone local to help them.

What kind of financial institution would you recommend and why?

1

Savings and Loan: focused on real estate (houses) financing, locally run, insured by government

2

Internet Bank: always available, offers competitive interest rates

3

Credit Union: locally run, offers business services and loans

4

Bank: easily accessible, helpful staff at many locations, online services, debt/credit cards

20

Multiple Choice

Max is opening his first bank account. He plans to save for college and wants to be able to deposit checks and use a debit card.

What kind of financial institution would you recommend and why?

1

Internet Bank: always available, offers competitive interest rates

2

Credit Union: locally run, offers business services and loans

3

Bank: easily accessible, helpful staff at many locations, online services, debt/credit cards

4

Savings and Loan: focused on real estate financing, locally run, insured by government

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Payday Loans & Check Cashing

Only loans (crazy high-interest)
& check cashing (high fees)

For the under/unbanked

AVOID!!There are free
alternatives (Even for undocumented)

Not insured

Examples:

Local, sketchy, loud advertising

25

Multiple Choice

Property required by the lender and offered by a borrower as a guarantee of payment on a loan.

1

finance charge

2

fixed property

3

collateral

4

lien

26

Multiple Select

Payday loans take out ____ advances on your ______

1

cash

2

bank

3

paycheck

4

loan

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12.01: Financial
Institutions

Source: pixabay.com

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