Answer each of the following questions in complete sentences.

1 Banks are businesses. Like other businesses, they seek profit. How do they earn profit?

2 Why might an individual want to use a bank? Give an example of why a person would use a bank.

3 Why might a business want to use a bank? Give an example of why a business owner would use a bank.

4 What is the Federal Reserve?

5 The money supply is the total amount of money available in the economy. How do changes in the money supply affect people and businesses?

6 How does banking affect the money supply?

7 What would happen if banking didn’t exist?

The Federal Reserve System has three primary functions: Managing the nation's monetary policy by overseeing the money supply and adjusting interest rates; Providing and maintaining an effective and efficient payments system between financial institutions; and. Supervising and regulating banking operations.

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Phazze Phazze · Answer 2 · 2022-06-23T22:01:47+02:00

The way that banks earn profit is through banking fees and interest payments on the loans they give out.

Individuals would use a bank to save their money.

Businesses can use banks to get loans to expand the business.

The Federal Reserve is the central bank of the United States.

When there is more money in supply, businesses and people will have more money to spend on goods and services. The reverse is true.

Banking affects money supply by increasing the amount of money in circulation when they create loans.

What is the purpose of banks?

Banks are very important in the financial system because they make loans which then create money for businesses and people to spend.

Banks are able to make their own profit when they gain interest from the loans they make. Their activities are monitored by the Federal Reserve which is the central banking system of the United States.

Find out more on the Federal Reserve at brainly.com/question/7798250.