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Deposits

Which of the ...

Question

Which of the following refers to the money people put in banks and from which they earn interest?

A

Credit

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B

Deposit

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C

Investment

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D

Savings

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Solution

The correct option is B Deposit
People save money in banks in the form of deposits and safeguard their money. Banks use the deposit money to lend credit or loans for which people are paid with interest money by the banks in return.

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Q. refer to the money people put in banks and from which they earn interest money.

Q. Which of the following refers to the rate of interest at which the commercial banks borrow money from the Reserve Bank of India?

Q. Assertion (A): Banks earn their profits by mobilising the depositor's money to the borrowers and keeping a portion of the interest charged.

Reason (R): Banks function for service motives; they do not function to make money, so they charge only interest and do not make any profits.

Q. Which of the following two aims for which people deposit their money in banks?

Q. Statement: Should there be only one rate of interest for term deposits of varying durations in banks?
Arguments:
I. No. People will refrain from keeping money for longer duration resulting into reduction of liquidity level of banks.
II. Yes. This will be much simple for the common people and they may be encouraged to keep more money in banks.

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