A business whose main purpose is to receive deposits and make loans.

A business whose main purpose is to receive deposits and make loans.

• A. Assets
• B. Bank
• C. Credit Card
• D. Debit Card

Answer: (B)

Taking deposits and making loans describes a bank. Banks gather funds from savers through deposit accounts and then lend those funds to individuals and businesses. The core idea is financial intermediation: turning many small deposits into productive loans. Banks earn from the difference between the interest they pay on deposits and the interest they receive on loans, plus fees, and they regulate themselves to manage risk and liquidity. The other options don’t fit as a business type. An asset is something a company owns, not its purpose. A credit card or a debit card is a product or service, not the kind of institution whose main activity is taking deposits and giving out loans.

Taking deposits and making loans describes a bank. Banks gather funds from savers through deposit accounts and then lend those funds to individuals and businesses. The core idea is financial intermediation: turning many small deposits into productive loans. Banks earn from the difference between the interest they pay on deposits and the interest they receive on loans, plus fees, and they regulate themselves to manage risk and liquidity.

The other options don’t fit as a business type. An asset is something a company owns, not its purpose. A credit card or a debit card is a product or service, not the kind of institution whose main activity is taking deposits and giving out loans.