FP1 Final Exam Rev. Part 2

Front

What type of service might a bank provide a business that needs the flexibility to borrow different amounts of money at different times without having to reapply? Options: mortgage, line of credit, installment loan, certificate of deposit

Back

line of credit

Front

The direction of a client's cash and securities by a financial services company, usually an investment bank, or an individual is known as:

Back

a lockbox.

Front

What type of service does a bank provide to a business that needs to borrow funds for a short period of time?

Back

line of credit

Front

The electronic clearance and settlement system used for financial transactions by U.S. commercial banks and other institutions is called the:

Back

automated clearing house (ACH)

Front

Which is a factor that determines how much investment risk a person can handle?

Back

goals

Front

Which of the following is considered when determining a person's credit score? A. payment history, B. income, C. social status, D. banking institution

Back

payment history

Front

Which is a disadvantage of investing in a savings account? Options: The account's potential for loss is high. The rate of return fails to keep up with inflation. One must pay a penalty for withdrawing.

Back

The rate of return fails to keep up with inflation.

Front

Which is an example of a lending investment? Options: bonds, stocks, antiques, real estate

Back

bonds

Front

Ownership investments are ideal for investors who are:

Back

seeking high returns.

Front

Who is most likely to be risk-tolerant?

Back

risk-tolerant.