banking Flashcards
What is the primary function of a bank?
To act as a financial intermediary that accepts deposits and provides loans.
True or False: Banks can only provide savings accounts.
False
What are the main types of banks?
commercial banks, and central banks.
Fill in the blank: A _______ bank is a joint stock bak which recieve deposits from public and business firms
commercial
What is a central bank?
A national bank that provides financial and banking services for the government and commercial banks.eg. reserve bank of india
What type of account typically earns interest and allows limited transactions?
Savings account
Multiple Choice: Which type of bank account is best for everyday transactions? A) Savings Account B)current Account C) reccurring account
B) Current Account
What is the function of an investment bank?
To assist in the raising of capital and provide advisory services for mergers and acquisitions.
True or False: A Certificate of Deposit (CD) usually has a fixed term and offers higher interest rates than a savings account.
True
What is the difference between a savings account and a current account?
A savings account is primarily for saving money and earns interest, while a current account is for everyday transactions.
Fill in the blank: _______ accounts are typically used for business transactions.
Business
What does FDIC stand for?
Federal Deposit Insurance Corporation
True or False: Banks only operate in their home country.
False
What is the purpose of a money market account?
To provide higher interest rates than traditional savings accounts while allowing limited check-writing privileges.
Multiple Choice: Which type of account usually requires a higher minimum balance? A) Savings Account B) Checking Account C) Money Market Account
C) Money Market Account
What is a key function of commercial banks?
To provide loans to individuals and businesses.
True or False: All banks are required to be members of the Federal Reserve System.
False
What is an online bank?
A bank that operates primarily over the internet without physical branches.
Fill in the blank: A _______ account is designed for frequent deposits and withdrawals.
checking
What is the main advantage of a high-yield savings account?
It offers a higher interest rate compared to standard savings accounts.
Multiple Choice: Which account typically has the least restrictions? A) Savings Account B) Checking Account C) CD
B) Checking Account
What is the role of a bank in the economy?
To facilitate the flow of money and credit, which supports economic growth.
True or False: Banks do not charge fees for account maintenance.
False
What is a joint account?
An account shared by two or more individuals.
