Ch 13-14-15 Review

A city that wants to finance a new water treatment plant would most likely issue which of the following?

• Treasury bonds

• Federal agency bonds

• Municipal bonds

• Corporate bonds

In financial terms, a bond is a _____________.

• Dividend

• Promissory note

• Commission

• Security

Banks use depositors money to make money through interest charged on loans.

• True

• False

Of the following types of deposit accounts, which one typically offers the lowest interest rate?

• A checking account

• A savings account

• A money market deposit account

• A certificate of deposit

A “bull market” is a market that is trending upward, with stocks increasing in price.

• True

• False

Which of the following is a major difference between credit unions and other depository financial institutions?

• Other depository financial institutions exist to serve their members rather than investors.

• Other depository financial institutions typically pay higher interest rates on deposits.

• A credit union is a nonprofit organization.

• A credit union typically has greater expenses.

When your long-term goal is to accumulate wealth, it is best to start saving after you have finished your education and established your career.

• True

• False

If you will likely need the money which you have set aside for an investment in the near future, you should avoid ______________.

• Savings account

• Money market accounts

• Checking account

• Stocks

When the supply of houses for sale in an area is greater than the demand for houses in that area, the prices of houses in that area will most likely ____________.

• Go up

• Stabilized

• Not be affected

• Go down

Accounts that offer a high degree of ________ usually offer the lowest interest rates.

• Liquidity

• Principal

• Insurance

• Risk