Question

3. Credit unions tend to focus strongly​ on:

Select one

A. leasing.

B. funds management.

C. payments systems.

D.personal finance.

4. The study of deposit−taking institutions:

Select one

A. does not include the funds management industry because such institutions are not ADIs.

B. shows that funds managers are essentially the same as banks.

C. is essential to understanding the funds management industry.

D. is hampered by lack of data on the funds management industry.

Answer 1

Answer 3- D.personal finance.

Reason - Credit unions are formed by the members themselves and exist as a non-profit organization whose main focus is to provide services to its customers and their welfare. Unlike banks, which focus more on profit making, credit unions target on providing guidance to its members in managing their personal finances. Credit unions focus on consumer savings as well as services needed by its members.

Answer 4 - B.shows that funds managers are essentially the same as banks.

Reason - The study of deposit-taking institutions help in understanding how the market is regulated and how money flows. Banks are the institutions who provide various services in order to regulate the flow of market in the economy. Accepting deposits is one of the primary functions of banks. But there are other institutions present in the market that works like a bank and helps in the maintaining the overall flow of money in the market. These institutions work like banks but are more like investment firms that have fund managers who also help in providing guidance for investing money in several areas.

The study of these institutions and banks in respect of their deposit-taking activities is necessary to understand that the fund managers also work like banks and are similar in almost all the aspects.