Banking and Finance Quiz

What is overdraft protection? Why would you want to have it attached to your account?

• A service that allows you to withdraw more money than you have in your account.

• A feature that prevents any transactions if your account balance is low.

• A type of insurance for your bank account.

• A savings account linked to your checking account.

What is one advantage and disadvantage of having a Certificate of Deposit or a CD?

• Advantage: Higher interest rates; Disadvantage: Limited liquidity

• Advantage: Easy access to funds; Disadvantage: Lower interest rates

• Advantage: No risk of loss; Disadvantage: High fees

• Advantage: Tax benefits; Disadvantage: Penalty for early withdrawal

Which of the following are examples of banking fees?

• All of the above

• ATM fee

• Monthly maintenance fee

• Overdraft fee

What is a blank endorsement vs a restrictive endorsement?

• A blank endorsement allows any holder to claim the funds, while a restrictive endorsement limits the use of the funds to a specific purpose.

• A blank endorsement requires a signature and a specific payee, while a restrictive endorsement requires only a signature.

• A blank endorsement is used for checks, while a restrictive endorsement is used for promissory notes.

• A blank endorsement is more secure than a restrictive endorsement.

What is identity theft and how can you prevent it?

• Identity theft is the act of stealing someone's personal information to commit fraud. It can be prevented by regularly monitoring financial statements and using strong, unique passwords.

• Identity theft is a type of computer virus. It can be prevented by installing antivirus software.

• Identity theft is a legal process to change one's identity. It can be prevented by not applying for it.

• Identity theft is a form of art. It can be prevented by not visiting art galleries.

What is liquidity? Which is the most liquid form of money? Which is the least?

• Liquidity is the ease of converting assets to cash. The most liquid form of money is cash, and the least liquid is real estate.

• Liquidity is the ability to invest in stocks. The most liquid form of money is stocks, and the least liquid is bonds.

• Liquidity refers to the stability of a currency. The most liquid form of money is gold, and the least liquid is cash.

• Liquidity is the process of saving money. The most liquid form of money is savings accounts, and the least liquid is cash.

What is the difference between a credit union and a commercial bank?

• Credit unions are non-profit organizations, while commercial banks are for-profit.

• Credit unions offer higher interest rates on savings than commercial banks.

• Commercial banks have more branches than credit unions.

• Credit unions are owned by their members, while commercial banks are owned by shareholders.

Who and what is the purpose of the FDIC?

• A government agency that insures bank deposits

• A private corporation that provides loans

• An international organization that regulates trade

• A non-profit organization that offers financial advice

What is the routing number on your checking/savings account?

• A 9-digit number used for bank transactions

• A 16-digit number on your debit card

• Your account balance

• The interest rate on your savings account

What is the account number on your checking/savings account?

• Unique nine-digit code that identifies a bank or credit union

• A unique identifier assigned to a specific bank account.

• Your social security number.

• None of these.