Chapter 5 - other markets and investments

Question 1

What are cash depositors and the main characteristics?

Answer 1

Cash depositors are accounts held with banks and other saving institutions.
Main characteristics: return is interest, full amount can be withdrawn
Advantages - fast liquidity, relatively safe, saving vehicle for interest
Disadvantages - Risk if the bank defaults, inflation could reduce return, currency risk

Question 2

After 2016, how much do tax payers now pay

Answer 2

Basic tax payers - up to £1000
High tax payers - up to £500