WAEC SSCE - Commerce - 2014 (Objective)

Question 1 Report

A fixed deposit account is beneficial to its holders because

cheques can be issued to settle huge debts

customers can become shareholders of the bank

it attracts higher interest rate

it allows customers overdraw their accounts

Answer Details

A fixed deposit account is beneficial to its holders because it typically offers a higher interest rate than a regular savings account. When you open a fixed deposit account, you deposit a fixed sum of money for a fixed period of time, usually ranging from a few months to several years. The bank pays you a fixed rate of interest on your deposit, which is typically higher than the interest rate paid on a regular savings account. Since the money in a fixed deposit account cannot be withdrawn until the end of the fixed period, this encourages people to save their money for a longer term. This can help people to plan their finances and achieve their financial goals. Furthermore, a fixed deposit account is a safe and secure investment as it is protected by the government's deposit insurance scheme, which ensures that your money is safe even if the bank were to fail. In summary, a fixed deposit account is beneficial to its holders because it provides a higher interest rate than a regular savings account, encourages long-term saving, and is a safe and secure investment. It does not allow customers to overdraw their accounts or issue cheques to settle huge debts, nor does it offer the opportunity to become a shareholder of the bank.






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