W!SE Review 3 -Investing and Banking

Buying a treasury bill (T-bill) is best for investors who are looking for 

• a place to invest between $100-$500 
• a secure, low risk investment
• a higher yield on their investment than corporate bonds offer
• an investment that matures in 10-30 years

As an investment, a person decides to buy a small house that has three rental apartments.  The profits from this investment may be lower than expected if the 

• tenant in an apartment decides to paint the hallways
• mortgage on the house is paid off
• taxes on the house are lowered
• one of the apartments in not rented

Securities are tradable documents that include

• stocks
•  bonds 
• mutual funds
• all of these

An investor bought 50 shares of Cool Corporations stock at $60 per share.  Two weeks later, the investor receives notice that the corporation has approved a 2-for-1 stock split.  Based on this information, the investor would own at the moment of the split

• 25 shares of the stock at the price of $60 per share
• 50 shares of the stock at the price of $30 per share
• 100 shares of the stock at the price of $30 per share
• 100 shares of the stock at the price of $60 per share

If Ford had to recall thousands of trucks due to a defect that had caused accidents resulting in several deaths, Ford stockholders are likely to

• buy more shares of Ford stock causing the price to increase
• sell shares of Ford stock causing the price of the stock to decline
• not react, resulting in no significant change in stock prices
• buy Ford bonds

If a person makes a cash deposit of $10,000 or more into a bank account, the bank must notify the 

• US Treasury Department
• Federal Deposit Insurance Corporation (FDIC)
• State Banking Commission
• Federal Reserve Bank

Banks use savings account deposits to 

• make their services and products attractive for new depositors
• pay for employee special projects and benefits
• give loans to consumers and businesses
• improve the quality of life in low-income communities

When someone is reconciling a checking account and notices that the balance in the checkbook does not match the balance on the bank statement, which action is it appropriate for the person to take first?

• determine that checks already written have cleared
• deposit sufficient funds to adjust the balance in the checkbook to match the bank's balance
• adjust the balance in the checkbook so it is the same as the bank's balance
• notify the bank in writing to adjust the statement

Which is the best example of a way to reduce fees paid for ATM transactions?

• When at a supermarket making a purchase with a debit card, add $50 cash to the transaction instead of using an ATM machine
• Find an ATM in a convenience store and only take out $20 each time
• Use any ATM instead of the ATM of the bank the issued the debit card
• Use any ATM machine, but only at night or on weekends

Putting money into a savings account is called

• verifying the account
• balancing the account
• making a deposit
• making a withdrawal