Depository Institutions
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Questions and Answers

Which type of deposits are accessible on demand?

  • Time deposits
  • Demand deposits (correct)
  • Savings accounts
  • Chequing accounts
  • Which type of deposits earn interest for depositors?

  • Chequing accounts
  • Time deposits
  • Demand deposits
  • Savings accounts (correct)
  • How does the depository institution earn interest?

  • By offering loans (correct)
  • By accepting time deposits
  • By charging fees
  • By keeping ready cash
  • Which term describes the concept of being able to buy the same level of goods and services in a foreign country when converting currency?

    <p>Purchasing power parity</p> Signup and view all the answers

    What is the main purpose of converting the cost of goods and services in one country to another currency?

    <p>To compare the cost of living between countries</p> Signup and view all the answers

    Which factor should remain constant for purchasing power parity to hold true?

    <p>Inflation rates</p> Signup and view all the answers

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