Everfi Financial Literacy

Interest is:

• a charge for lending money to a bank

• the amount owed for borrowing money

• the amount added into your savings when opening a bank account

• a charge for the convenience of accessing money stored in your bank account

Anthony is deciding between different savings accounts at his bank. He has four options, based on how frequently interest compounds. Which should he choose if he wants the best rate of return on his interest?

• Annual Compounding

• Semi-Annual Compounding

• Monthly Compounding

• Daily Compounding

What is the typical relationship between time and interest rate?

• Longer time period usually equals higher interest rates.

• Shorter time period usually equals higher interest rates.

• Longer time periods usually have no effect on interest rates.

• Shorter time periods usually have no effect on interest rates.

Tamara has $500 she is looking to save for a class trip. She wants to earn the most possible interest and will not need access to her money for a full year. Which type of savings account will be best for Tamara?

• Certificate of Deposit (CD)

• Money Market Account

• Savings Account

• Checking Account

Which type of account typically has very high liquidity, low or no interest, and low minimum balance?

• Checking Account

• Money Market Account

• Certificate of Deposit (CD)

• Investment Retirement Account (IRA)

The purpose of a budget is to:

• help you plan how you will spend the money you earn or receive.

• stop you from spending too much money.

• increase the balance of your savings account

• tell you how much you owe the government in taxes

Which type of financial institution typically has membership requirements?

• Credit Union

• Online Commercial Bank

• Commercial Bank

• Federal Reserve Bank

Which of these fees would likely be the highest

• Overdraft fee

• Account transfer fee

• Monthly service fee

• ATM fee

The numbers on the bottom of a typical check represent all of the following except

• Social Security number

• Routing Number

• Account Number

• Check Number

What part of a check is the least important?

• The check number

• Signature line

• Memo line

• Routing number