Financial Literacy Quiz Spring 2024 #2

Which type of account would be most suitable for Juan who wants to save $1,000 from his summer job without needing immediate access and aims to get the highest interest rate?

• Regular savings account

• Money Market account

• Checking account

• Certificate of Deposit

Joelle is planning to save for an emergency fund that covers 6 months of expenses. If her monthly expenses are $2,000 and she saves 10% of her $4,000 monthly income, how many months will it take to reach her goal?

• 3 months

• 9 months

• 24 months

• 30 months

When planning a savings strategy, which set of goals is an example of short-, medium-, and long-term objectives?

• Retirement, a house down payment, college tuition

• A new cell phone, college tuition, a house down payment

• A new cell phone, dinner with friends this weekend, a new bike

• Retirement, college tuition, a vacation

Which statement is true regarding the financial preparedness of most Americans for emergencies and retirement?

• The majority of Americans have an adequate emergency fund

• The majority of Americans have sufficient amounts of money saved for retirement

• The majority of Americans have an adequate emergency fund, but do NOT have sufficient amounts of money saved for retirement

• The majority of Americans do NOT have an adequate emergency fund or sufficient amounts of money saved for retirement

Which statement best describes a savings account?

• This account offers a convenient way to pay bills and access cash from an ATM

• This account pays you interest on money you have put away for later to help your money grow

• This account is automatically debited when you use a debit card

• This account typically allows an unlimited number of transactions per month

What is FDIC Insurance primarily designed to provide?

• Optional coverage consumers can purchase so that their bank deposits remain safe

• Insurance bank branches can buy to protect their business against fraud and scams

• Protection for bank customers’ deposits up to $250,000, guaranteeing their money is still available if the bank goes out of business

• Required if you want to do online or mobile banking

What is likely to happen if you have overdraft protection and your account goes negative?

• Your account will be closed

• You will likely be charged an overdraft fee for one or more of the transactions and also will need to repay the bank for the amount overdrawn

• Since you requested overdraft protection, the bank will not allow you to overdraw your account so your debit card will be denied

• The bank will provide you five days to add funds to your account to cover the overdraft and no fees will be assessed

What is likely to happen if you do not have overdraft protection and your account goes negative?

• Your account will be closed

• You will likely be charged an overdraft fee for one or more of the transactions and also will need to repay the bank for the amount overdrawn

• Since you declined overdraft protection, the bank will not allow you to overdraw your account so your debit card will be denied

• The bank will provide you five days to add funds to your account to cover the overdraft and no fees will be assessed

Fill in the blanks: Direct deposit typically refers to your ______ sending your ______ electronically to your bank account.

• employer, bills

•  employer, paycheck

• parents, allowance

• state government, taxes

Which of the following is an effective strategy for personal saving?

• Save a certain percentage of each paycheck and deposit it directly into a savings account

• • Take out a payday loan so you can save before you receive your paycheck

• . Save a certain percentage of each paycheck and deposit it directly into a savings account

• • Wait until the end of the month and save whatever is left in your checking account