How Banks Work Reading and Questions

What is the primary function of banks according to the passage?

• To keep money safe for account holders

• To lend money to others

• To pay interest on deposits

• To provide electronic banking services

What was the reserve requirement set by the Federal Reserve for banks at the time this article was written?

• 1% to 5%

• 3% to 10%

• 10% to 20%

• 5% to 15%

Which type of account typically does not pay interest?

• Savings account

• Money market account

• Checking account

• Certificate of deposit

The Federal Deposit Insurance Corporation (FDIC) was established in ___ to provide deposit insurance coverage.

Banks make money by charging higher interest on loans than they pay on ___.

• deposits
• lending

• reserves

• checking