Money and Banking

Question 1

dWhat is a commercial bank?

Answer 1

It is a financial institution that provides financial services to the public, with the aim of profit maximization e.g UBA, NFC

Question 2

What are the functions of a commercial bank?

Answer 2

Deposits:
Banks make it possible for individuals and businesses to deposit their money at a bank for safekeeping, they provide two main account types for them i.e. Checking and Savings accounts, savings account owners can benefit from interest for every month their money is at the bank, and checking account owners benefit from having their money always readily available for transactions.

Issuing Loans:
Banks issue loans to credit-worthy businesses and individuals, which they have to repay in installments with credit

Question 3

What are some characteristics/functions of money?

Answer 3

-> It is a medium of exchange,
-> a store of value,
-> a measure of value,
-> legal tender,
-> and a standard of deferred payment

Question 4

What is money?

Answer 4

Money is an accepted medium of exchange that people use to buy goods and services