Understanding Financial Institutions and Their Roles

What is the primary role of financial institutions in the economy?

• Providing a wide range of services including deposit, lending, and investment products

• Manufacturing goods and services

• Regulating international trade

• Developing new technologies

Which type of financial institution is nonprofit and member-owned, often offering reduced fees and better interest rates?

• Credit unions

• Commercial banks

• Investment banks

• Brokerage firms

What is the main function of the Federal Reserve as the central bank of the United States?

• Conducting monetary policy to ensure maximum employment and stable prices

• Issuing credit cards to consumers

• Providing personal loans to individuals

• Selling insurance policies

Which financial institution acts as an intermediary in complex transactions and helps raise capital through securities issuance?

• Investment banks

• Retail banks

• Credit unions

• Insurance companies

In which type of countries are contractual savings institutions more developed, playing a significant role in the financial system?

• High-income countries

• Developing countries

• Low-income countries

• Middle-income countries