W!SE Prep - Banking

If a person makes a deposit of $10,000 or more into a bank account, the bank must

• US Treasury Department.
• Federal Deposit Insurance Corporation. (FDIC).
• State Banking Commission
• Federal Reserve Board.

When James received his paycheck, he planned to cash it at a check cashing store. You advise him to cash it at his own bank if possible. Why

• They typically require a two day waiting period before giving cash
• They typically charge high fees
• There is likely to be a ceiling on the size of the check he can cash
• They generally require a cosigner

Travelers checks, often used for vacations:

• Are equivalent to credit cards
• Are free at most banks
• Function as cash and are easily replaced if lost
• Are FDIC insured

The phrase used for putting money into a savings account is:

• Verifying the account
• Balancing the account
• Making a deposit
• Making a withdrawal

The term used to describe the ease and speed with which you can convert savings or an investment to cash is:

• Convertibility
• Principal
• Liquidity
• Rate of return

The best suggestion you gave a friend who is writing a check for the first time is:

• Date the check because it is usually proof of payment
• Use pencil to permit changes
• Make the check payable to cash
• Use the checkbook stub or register to keep a record of the date you write the check

A bank Certificate of Deposit is a

• Savings instrument that requires a deposit for a period of time during which the saver can withdraw money from the plan at any time without a penalty
• Savings instrument that requires a deposit for a period of time during which there is a penalty for withdrawals
• Cash deposit in a savings account that earns interest
• Certificate for deposits that are issued for half the face value

Troy has $50 a month transferred electronically from his checking account to his savings account. This is an example of:

• An installment payment
• A savings plan
• An ATM transaction
• A debit card transaction

Which financial product can you buy for $25, is safe, and will be worth $50 at a future date?

• Series EE savings bond
• Certificate of deposit
• 50 shares of ABC Co. stock
• ABC Co. bond

"The Fed" is short for:

• The Federal Reserve System
• Congress
• FBI
• The Federal Deposit Insurance Corporation