Section 4.1: Part #1

What is the primary purpose of financial institutions?

• To provide entertainment services

• To build highways, schools, and hospitals

• To keep money flowing throughout the economy

• To produce paper money and coins

Which of the following is an example of a depository institution?

• Real estate agency

• Investment firm

• Credit union

• Insurance company

What is money known as?

• Stock

• Currency

• Bond

• Commodity

Who produces paper money in the United States?

• The Department of Commerce

• The US Treasury

• The Federal Reserve

• The United States Mint

What happens to money deposited in a bank?

• It is converted into stocks

• It is sent to the Federal Reserve

• It is lent to other consumers and organizations

• It is stored in a vault

What type of bank is owned by its depositors?

• Commercial bank

• Internet bank

• Mutual savings bank

• Community bank

What is the primary advantage of Internet banks?

• Physical locations

• Personalized customer service

• Paper-based transactions

• Higher interest rates on savings

What is a credit union?

• A state government agency

• A non-profit financial cooperative

• A federal government agency

• A for-profit financial institution

What is a check?

• A form of digital currency

• A type of savings account

• A written order to pay a specific amount

• A loan agreement document

What must banks have in order to do business in the United States?

• A physical branch in every state

• A CEO with a finance degree

• An account with the Federal Reserve

• A charter