Banking & Finance- 3rd Quarter Benchmark Review

Which best describes the difference between bartering and the monetary system?

• A. Bartering does not work in undeveloped countries, but the monetary system does.

• B. Monetary means trading money for money, bartering means trading goods for goods.

• C. Bartering means trading goods for other goods instead of using money as a standard of value.

• D. Bartering is never used in developed countries, and only rarely in undeveloped countries.

Which is NOT considered money?

• coins

• currency

• checks

• services

What is a financial institution?

• a bank account

• a firm that manages money

• a record of the amount of money a customer has

• a medium of exchange

Which is best for storing money for a few days?

• checking accounts

• savings accounts

• electronic funds transfers

• direct deposits

How do banks make most of their money?

• transferring money

• collecting collateral

• interest from loans

• fees from checking accounts

Which is another term for full-service bank?

• commercial bank

• savings and loan association

• credit union

• international bank

Which types of investments are savings and loan associations known for?

• commercial loans

• mortgages

• lines of credit

• personal loans

How is a credit union different from other financial institutions?

• Credit unions do not offer loans

• Credit unions do not offer credit cards

• Credit unions offer interest on their savings accounts

• Credit unions do not make a profit.

Which statement about the Federal Reserve is true?

• You can get a loan from the Federal Reserve

• The Federal Reserve has always been part of the U.S. banking system.

• The Federal Reserve is a full-service bank

• There are twelve regional Federal Reserve banks.

What is the Federal Reserve's main mission?

• to monitor inflation

• to provide the U.S. with a safe and stable monetary system

• to determine the amount of money in circulation

• to act as the government's fiscal agent