Career Prep Final Exam Review

The highest yielding savings accounts are paying historically low interest rates, so Maria is only able to get a 1% annual interest rate for her savings account. Assuming interest rates do not change, use the Rule of 72 to approximate how many years it will take for her to DOUBLE her money in this account?

• 1 year
• 5 years
• 10 years
• 72 years

Which of the following transactions will REDUCE your checking account balance immediately?

• Writing your monthly rent check which you will mail tomorrow
• Using your debit card to pay for groceries at the supermarket
• Using your credit card to pay for your school books
• Depositing a check at a local bank branch

Which action below is considered a best-practice for check writing?

• Using a pencil so that you can quickly erase any errors without having to throw any checks away
• Recording all of your transactions in a check register
• Leaving the “to” field blank until the very last minute, so that no one else can steal the check
• Writing quite sloppily in each field so that no one else can forge your handwriting

How are credit unions and banks different?

• Typically, deposits at a bank are insured, but deposits at a credit union are not
• Banks charge overdraft fees, but credit unions do not
• Banks are owned by shareholders, while credit unions are owned by members
• Banks allow customers to do online banking, while credit unions are too small to provide that service

Juan saved $1,000 from his summer job cleaning pools. Which of these savings vehicles would work best for him if he doesn't need access to the money for a number of years AND wanted to earn the highest interest rate?

• Regular savings account
• Money Market account
• Checking account
• Certificate of Deposit

What would be a good time to spend money from your Emergency Fund?

• You lose your job but still have bills to pay
• Your friend tells you that you should buy as much Bitcoin as possible
• Your favorite artist releases a new album and you just have to buy it
• Your friends are going on an expensive trip an you would like to go with them

If you used the 50-30-20 rule of budgeting, how much money would you be saving?

• 20%
• 30%
• 50%
• 100%

Price matching is when…

• A store sends you a coupon for an item in your cart to encourage you to buy it sooner
• A store agrees to match the lower price of an identical item that is being offered at another retailer
• A store lets you know ahead of time that an item you’re interested in will be on sale in the next week
• A store agrees to match the lower price you bought an item at in the past

The average American teenager is likely to spend MOST of their money on...

• Bills and utilities
• Transportation
• School-related items
• Food

For most Americans, which budget expense category is largest?

• Housing
• Food
• Transportation
• Clothes