Tag: introduction, recurring deposit accounts and calculation of interest on a fixed deposit account

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Multiple choice maths banking and taxation types of accounts banks introduction, recurring deposit accounts and calculation of interest on a fixed deposit account

________ is guarantee to return a payment.

  1. savings account

  2. fixed deposit

  3. current account

  4. recurring deposit
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Fixed Deposits (FD) are investment instruments offered by banks and non-banking financial companies, where one can deposit money for a higher rate of interest than savings accounts. One can deposit a lump sum of money in fixed deposits for a specific period, ranging from 7 days to 10 years. 


Fixed Deposits guarantee a return on investment. 

Multiple choice maths banking and taxation types of accounts banks introduction, recurring deposit accounts and calculation of interest on a fixed deposit account

What type of function is a collection of cheques in a bank?

  1. secondary

  2. primary

  3. compulsory

  4. mandatory
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

Secondary function is a collection of cheques in a bank.
The bank collects the money of the cheques through clearing section of its customers. The bank also collects money of the bills of exchange.

Multiple choice maths banking and taxation types of accounts banks introduction, recurring deposit accounts and calculation of interest on a fixed deposit account

Fixed deposits can have ______.

  1. Nomination facility with the permission of Bank Chairman

  2. Nomination facility on the day of closing

  3. Nomination facility

  4. Nomination facility by taking special permission from bank
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

Nomination is a facility that enables a fixed deposit account holder to nominate an individual, who can claim the proceeds of the deposit account, post the demise of the original depositor. It is compulsory and doesn't require any permission from the bank.

Multiple choice maths banking and taxation types of accounts banks introduction, recurring deposit accounts and calculation of interest on a fixed deposit account

You can use a _______ to make electronic fund transfers to another account.

  1. savings account

  2. fixed account

  3. recurring account

  4. current account
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

$\Rightarrow$  You can use a $Savings\, account\,$ to make electronic fund transfer to another account.

$\Rightarrow$  A savings account holds your money in a safe place - your bank or credit union. Instead of carrying cash or keeping money in your home, you can put the funds into savings account for safe keeping.
$\Rightarrow$  Savings accounts offer easy access to you cash (also known as liquidity, or the ability to make a withdrawal easily and quickly). Once you're ready to spend money you can withdraw cash or pay by check, debit card, or an electronic fund transfer.

Multiple choice maths banking and taxation types of accounts banks introduction, recurring deposit accounts and calculation of interest on a fixed deposit account

Which among the following accounts fetch the highest rate of interest?

  1. saving deposits

  2. recurring deposits

  3. fixed deposits

  4. current deposits
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

Fixed Deposits (FD) are investment instruments offered by banks and non-banking financial companies, where one can deposit money for a higher rate of interest than savings accounts. These deposits, hence, offer the highest rate of interest, ranging from $4$ to $7.25$ percent.

Multiple choice maths banking and taxation types of accounts banks introduction, recurring deposit accounts and calculation of interest on a fixed deposit account

When a certain amount is deposited for a fixed period such as six months, one year or longer. Such type of account is

  1. saving account

  2. current account

  3. recurring deposit account

  4. fixed deposit account
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

When a certain amount is deposited for a fixed period such as six months, one year or longer. such type of account is fixed deposit account.