Certificates of Deposit and Money Market Accounts Quiz

What are the benefits of Money Market accounts?

• Low interest rates, difficult access to funds, and no insurance protection.

• Higher interest rates, easy access to funds, and FDIC insurance protection.

• Lower interest rates, limited access to funds, and no insurance protection.

• No interest rates, restricted access to funds, and no insurance protection.

What is a feature of Certificates of Deposit (CDs)?

• No interest rate

• Fixed interest rate

• Unlimited withdrawal

• Variable interest rate

Which of the following is true about Money Market accounts?

• They have a higher minimum balance requirement than traditional savings accounts.

• They are not insured by the FDIC.

• They have lower interest rates than traditional savings accounts.

• They offer higher interest rates than traditional savings accounts.

What is a benefit of Certificates of Deposit (CDs)?

• Lower interest rate

• Higher risk

• Higher interest rate

• No interest rate

Which of the following is a similarity between Certificates of Deposit and Money Market accounts?

• Certificates of Deposit require a minimum balance to open, while Money Market accounts do not.

• They are both high-risk investment options that offer lower interest rates than traditional savings accounts.

• They are both low-risk investment options that offer higher interest rates than traditional savings accounts.

• Certificates of Deposit have a variable interest rate, while Money Market accounts have a fixed interest rate.

Which of the following is a benefit of Certificates of Deposit (CDs)?

• Higher interest rates and high-risk investment option

• Lower interest rates and low-risk investment option

• Higher interest rates and low-risk investment option

• No interest earned and high-risk investment option

In relation to the other options, how liquid is a savings account?

• More liquid than cash
• Less liquid than mutual funds
• More liquid than a Certificate of Deposit
• More liquid than a checking account

Hannah needs a savings tool to help her manage her everyday purchases. The savings tool needs to be very liquid and accessible. Which of the following savings tools should Hannah choose?

• Certificate of deposit
• Checking account
• Money market deposit account
• Any of the above savings tools would help Hannah

Which of the following is a feature of a certificate of deposit (CD)?

•  Funds deposited in a CD are held for a certain length of time.
• Funds deposited in a CD have tiered interest rates.
•  Funds deposited in a CD are very liquid.
• Funds deposited in a CD can be accessed via check or debit card.

9.  Which of the following is a feature of a money market deposit account?

• No minimum balance requirements
• Unlimited transactions every month
• Tiered interest rates
• The money must remain in the account for a specific period of time