Which of the following are primary depository institutions that accept deposits of households and businesses, keep money safe until it is demanded via checks, and in the meantime use it to make available a wide variety of loans?

Question

Multiple choice question.

Mutual fund companies

The Federal Reserve Banks

Commercial banks

Money markets

Answer 1

The primary depository institutions that accept deposits of households and businesses, keep money safe until it is demanded via checks, and use those deposits to make loans are:

Commercial banks

Mutual fund companies, the Federal Reserve Banks, and money markets do not primarily operate as depository institutions in this way.