Unit 6 Quiz: Financial Institutions

What is the role of the Federal Deposit Insurance Corporation (FDIC)?

• Insuring deposits in bank accounts up to $250,000

• Regulating online banking transactions

• Providing credit to unbanked individuals

• Offering overdraft protection services

What is the main difference between retail banks and credit unions?

• Credit unions are for-profit institutions

• Retail banks offer lower cost deposit accounts

• Credit unions are owned and operated by their members

• Retail banks are insured by the NCUA

What is the main downside of online-only banks?

• They have physical branch locations

• They are insured by the FDIC

• They offer overdraft protection services

• All transactions are done online

What is the purpose of overdraft protection offered by banks?

• To cover overspending in an account

• To provide insurance for deposits

• To charge a fee for overspending

• To offer lower cost lending services

Aria, Scarlett, and Arjun are managing their finances. They are discussing the function of a checking account register. What do you think is its function?

• To track their investment banking activities

• To reconcile their checking account balance

• To record their credit card transactions

• To insure their deposits in credit unions

What is the main difference between savings and money market accounts?

• Savings accounts have higher interest rates

• Money market accounts act as a high-bred between checking and savings accounts.

• Savings accounts have lower risk

• Money market accounts have lower minimum balance requirements

Elijah noticed some unusual activities in his banking simulator. As a bank employee, what could be a sign of fraud that he should look for?

• Tracking payments and bill pay

• Reconciling checking account balance

• Automatic electronic deposit of payroll checks

• Unusual account activity or unauthorized transactions

What role did banks play in the 2008 financial crisis?

• They provided insurance for deposits

• They offered overdraft protection services

• They regulated online banking transactions

• They engaged in risky lending and investment practices

Why was it necessary for the government to intervene in the 2008 financial crisis?

• To offer lower cost deposit accounts

• To provide credit to unbanked individuals

• To regulate online banking transactions

• To prevent the collapse of major financial institutions

If you see "pending" on an account charge, that means. . .

• It is suspected of being a fraudulent charge

• It hasn't been fully processed yet

• The payment was declined

• You need to make a deposit before it is paid