Unit 2 Test Bank Questions

A key difference between commercial banks and credit unions is that: a.) Commercial banks are 'for‐profit' and credit unions are 'not‐for‐profit' b.) Commercial banks typically pay higher interest rates than credit unions. c.) Credit unions are more commonly located in rural areas while commercial banks are more commonly located in urban areas. d.) Commercial banks offer more services, such as debit cards and online banking, than credit unions. - A Since Taylor was a young child she has kept her savings in a piggy bank. She likes this method of saving because she can have immediate access to the money if she needs it. Recently, in a class at school, discussion focused on why depository institutions are safer than her piggy bank. Some students' comments were based on fact while others were based on myths. Which aspect of security at a depository institution is NOT TRUE? a.) Depository institutions have insurance protection for up to $250,000 per depositor per account type. If something happened to the money in the bank, you would get the value of your account back as long as the deposited amount was no more than the insurance limit. b.) All money stored at a depository institution is kept safe at all times by numerous security measures. c.) Information about depositors and their accounts is kept in secure data storage. d.) Depository institutions have insur -D Sanjay is concerned about the safety of the money in his savings account. Which type of depository institution should he choose? a.) A commercial bank, since his deposits would be insured by the Federal Deposit Insurance Corporation (FDIC)