3-1 Understanding Banks Business U

What is a financial institution licensed to receive and store deposits, and provide loans and other financial services?

• Bank

• Creditor

• Debtor

• Retailer

What allows the account holder to deposit and withdraw funds, and conduct other financial transactions?

• Loan

• Bank Account

• Deposit

• Interest

What occurs when too many people try to withdraw their money from a bank at the same time?

• Bank Run

• Loan Default

• Interest Hike

• Credit Crunch

Who is an individual or entity that lends money or extends credit to another?

• Debtor

• Creditor

• Bank

• Borrower

Who is an individual or entity that owes money to another party?

• Creditor

• Investor

• Debtor

• Lender

What is a sum of money securely stored at a bank called?

• Loan

• Deposit

• Interest

• Credit

What is the cost (or income) of borrowing money?

• Loan

• Deposit

• Interest

• Credit

What is a sum of money borrowed with the expectation to be paid back with interest over a specified period of time?

• Deposit

• Loan

• Interest

• Credit

What type of policy stimulates or slows down the economy by adjusting interest rates and money supply?

• Fiscal Policy

• Trade Policy

• Monetary Policy

• Tax Policy

What is the difference between the interest banks earn on their loans and the interest banks pay to their depositors?

• Loan Spread

• Interest Rate

• Net Interest Margin

• Credit Margin