Banks, Credit & the Economy | Monetary Policy Lesson Plan | iCivics - Free Printable

Here are the correct answers for the worksheet sections shown.

A. Vocabulary

*Match each word with its definition.*

1. Money — E. A medium of exchange that acts a common standard of value
2. Currency — C. Coins and paper money printed by the government
3. Deposit — N. Money you put in your bank account
4. Withdrawal — M. Money that a bank keeps and does not lend out *(Note: In this specific worksheet context, Withdrawal is matched with M because it represents cash taken out of circulation/lending pools, or simply by process of elimination as other definitions fit better elsewhere).*
5. Interest — B. The fee charged to the right to borrow money
6. Federal Reserve — L. The central bank of the United States
7. Inflation — H. Prices go up over time
8. Deflation — O. Prices go down over time
9. Income — I. A person's source of money, dependent on the ability to produce
10. Reserve — F. Put money into a bank account *(Note: By elimination, this matches F, though typically "Reserve" refers to funds kept back. "Deposit" fits N perfectly.)* *Correction*: Let's re-evaluate based on standard definitions provided in these worksheets.
* Let's look at K: "Repaying a loan to get your collateral back". This usually defines redeeming collateral.
* Let's look at J: "Takes cash out of their accounts". This is clearly Withdrawal. So 10 is J.
* Let's look at M: "Money that a bank keeps and does not lend out". This is the definition of Reserves. So 10 is likely meant to be Reserves, but the word is Reserve. Wait, let's look at item 10 again. It says Reserve. Definition M is "Money that a bank keeps and does not lend out". This is the best fit for Reserve/Reserves.
* Let's re-read Withdrawal (10). Definition J is "Takes cash out of their accounts". This is the perfect definition for Withdrawal. So 10 is J.
* Then what is Reserve? Item 10 is labeled "Reserve". But wait, looking at the list:
1. Money -> E
2. Currency -> C
3. Deposit -> N (Put money into... wait, N is "Money you put in your bank account". F is "Put money into a bank account". Both are similar. Let's look closer.)
Let's restart the matching carefully.

* 1. Money: E (Medium of exchange...)
* 2. Currency: C (Coins and paper money...)
* 3. Deposit: N (Money you put in your bank account) OR F (Put money into a bank account). Usually, Deposit is the noun (N) and the action is F. Let's hold.
* 4. Withdrawal: J (Takes cash out of their accounts).
* 5. Interest: B (The fee charged to the right to borrow money).
* 6. Federal Reserve: L (The central bank of the United States).
* 7. Inflation: H (Prices go up over time).
* 8. Deflation: O (Prices go down over time).
* 9. Income: I (A person's source of money...).
* 10. Reserve: M (Money that a bank keeps and does not lend out).
* 11. Entrepreneur: D (People who want to start a new business).
* 12. Credit reporting bureaus: G (Keeps a tab on how you borrow money).
* 13. Credit scoring bureau: A (Helps determine if someone will pay back credit). *Wait, G and A are very similar.* Let's look at K: "Repaying a loan to get your collateral back". This doesn't fit well yet.
* Let's look at 14. Collateral: K is the only one mentioning collateral. So 14 is K.
* Now back to 12 & 13.
* 12. Credit reporting bureaus: These collect data. G "Keeps a tab on how you borrow money" sounds like tracking history.
* 13. Credit scoring bureau: These analyze data to give a score. A "Helps determine if someone will pay back credit" sounds like the result of the score.
* Now back to 3. Deposit and F/N.
* 3. Deposit: N "Money you put in your bank account" (Noun).
* What is left for F? "Put money into a bank account". Is there another word?
* Let's check 10. Reserve again. If 10 is M, what is left?
* We have used: E, C, N, J, B, L, H, O, I, M, D, G, A, K.
* Leftover definitions: F ("Put money into a bank account") and P ("Company that loans banks part of your credit history"?? No, P says "Company that loans banks part of your credit history" - actually P text is cut off or weird. Let's read P: "Company that loans banks part of your credit history". That doesn't make sense. Let's re-read P in image: "Company that loans banks part of your credit history". Actually, looking at 13, maybe P goes there? No.
* Let's look at F again. Is there a verb word? No.
* Let's look at 3. Deposit. Could it be F? "Deposit" can be a verb. Then N is left.
* Is there a word for N? "Money you put in your bank account".
* Let's look at 10. Reserve. If 10 is M, we are good.
* Let's look at 14. Collateral. K is "Repaying a loan to get your collateral back". That defines *redeeming* collateral, not collateral itself. But it's the only match.
* Let's look at P: "Company that loans banks part of your credit history". This seems like a typo in the worksheet for "Credit Bureau".
* Let's look at A: "Helps determine if someone will pay back credit".
* Let's look at G: "Keeps a tab on how you borrow money".

* *Alternative Matching for 12/13/P/A/G:*
* 12. Credit reporting bureaus: G (Keeps a tab/history).
* 13. Credit scoring bureau: A (Determines risk/score).
* What is P? "Company that loans banks part of your credit history". This might be a distractor or a bad definition for Credit Reporting Bureau.
* What is F? "Put money into a bank account".
* What is N? "Money you put in your bank account".
* If 3. Deposit is N, then F is unused.
* If 3. Deposit is F, then N is unused.
* Is there a word missing? No, 1-14.
* Let's assume 3. Deposit matches N (Noun form).
* Then F is left. Is there a word that means "Put money into..."? Maybe Investment? No, Investment is not on the list.
* Wait, look at 10. Reserve. Definition M is "Money that a bank keeps...".
* Look at 14. Collateral. Definition K involves collateral.
* Look at 11. Entrepreneur. Definition D.
* Look at 9. Income. Definition I.
* Look at 8. Deflation. Definition O.
* Look at 7. Inflation. Definition H.
* Look at 6. Federal Reserve. Definition L.
* Look at 5. Interest. Definition B.
* Look at 4. Withdrawal. Definition J.
* Look at 2. Currency. Definition C.
* Look at 1. Money. Definition E.

* Remaining Words: 3. Deposit, 10. Reserve (already matched M?), 12. Credit reporting, 13. Credit scoring, 14. Collateral.
* Remaining Definitions: A, F, G, K, M, N, P.
* We established:
* 14. Collateral -> K (Best fit despite wording).
* 10. Reserve -> M (Best fit).
* 3. Deposit -> N (Best fit for noun).
* This leaves F, A, G, P for 12, 13. And two extra definitions?
* There are 14 words and 16 definitions (A-P). Two definitions are distractors.
* Distractors are likely F (Verb form of deposit, redundant) and P (Poorly phrased definition).
* So:
* 12. Credit reporting bureaus -> G (Keeps a tab on borrowing).
* 13. Credit scoring bureau -> A (Helps determine repayment likelihood).

* *Self-Correction on 10/Reserve*: Some worksheets define "Reserve" as the act of setting aside. But M is "Money... kept". That's a noun. Fits.

Final Vocabulary List:
1. E
2. C
3. N
4. J
5. B
6. L
7. H
8. O
9. I
10. M
11. D
12. G
13. A
14. K

B. The Fed, Part #1

*Fill in the blank using the rules that banks must follow.*

1. The Fed sets rules that banks must follow.
2. The Fed set affects the interest rates that banks charge for loans. *(Note: Typo in worksheet "set" should be "rate" or "policy", but answer is interest)*.
3. The Fed creates money for the air, so inflation is always around. *(Note: Worksheet text is garbled "for the air". It likely means "into the economy". The concept is inflation)*.
4. The Fed gets to keep the economy healthy.
5. People can set up checking and savings accounts at the Fed. *(Wait, people don't open accounts at the Fed. They open them at commercial banks. The Fed regulates them. However, in simplified civics, sometimes they ask where money is stored. But the Fed is the "bank for banks". Let's look at the sentence: "People can set up checking and savings accounts at the ______." This is factually incorrect for the Fed. It should be "banks". But if the topic is "The Fed", maybe it's a trick question or I need to read the context. Ah, looking at typical worksheets: "The Fed regulates banks." Maybe the blank is banks? Or maybe credit unions? Given the header is "The Fed", this question might be flawed or referring to member banks. Let's assume the answer expected is banks or commercial banks).*
* *Correction*: Looking at similar worksheets online, this line often reads: "People can set up checking and savings accounts at banks." The Fed does *not* serve individuals.
6. The Fed has to keep employment high and prices stable.
7. The Fed processes checks and electronic payments.
8. The Fed supervises the banking industry.
9. Coins and paper money are made by the Treasury (or Mint/Bureau of Engraving), but distributed by the Fed. The worksheet likely wants Treasury or Mint.
10. The Fed is a Federal Reserve bank in every state. *(False, there are 12 districts. But the blank might be district? "The Fed is a Federal Reserve bank in every district.")*

Let's refine B based on standard "Functions of the Fed" curriculum:
1. rules
2. interest
3. inflation (Context: creating money causes inflation)
4. healthy (or stable)
5. banks (People use commercial banks, not the Fed)
6. employment
7. checks
8. supervises (or regulates)
9. Mint (Coins) / Bureau of Engraving (Paper). Often simplified to Treasury.
10. district

C. Loans

*Follow the directions in each box.*

Box 1:
*Prompt:* Draw the way a loan could help someone start their own business.
*Answer Idea:* Draw a person receiving money from a bank, then buying supplies (like a lemonade stand, tools, or a computer) to start working.

Box 2:
*Prompt:* Draw one way a loan could cause someone to spend too much or have other problems.
*Answer Idea:* Draw a person with many shopping bags or expensive toys, looking worried because they have no money left to pay the bank back.

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Final Answer:

A. Vocabulary
1. E
2. C
3. N
4. J
5. B
6. L
7. H
8. O
9. I
10. M
11. D
12. G
13. A
14. K

B. The Fed, Part #1
1. rules
2. interest
3. inflation
4. healthy (or stable)
5. banks
6. employment
7. checks
8. supervises
9. Treasury (or Mint)
10. district

C. Loans
*(These are drawing tasks, but here is what you should draw)*
* Left Box: Draw a person getting money from a bank teller and using it to buy items for a business (like a lawnmower for a lawn care business).
* Right Box: Draw a person looking stressed while holding bills, or surrounded by things they bought but can't afford to pay back.