Chapter 5 The Banking System

Paper money is also known as banknotes.

• True

• False

A canceled check serves as proof of payment for bills or purchases.

• True

• False

The payee is the person who is writing the check.

• True

• False

If a check is not properly endorsed, it may be returned by the bank to the customer and not deposited.

• True

• False

A third-party check can easily be cashed or deposited into any account.

• True

• False

You should reconcile your bank statements at least once a year.

• True

• False

When a check is cashed, the check is said to be truncated.

• True

• False

Savings accounts at banks generally are insured by the FDIC up to the legal limit of $250,000 per deposit per bank.

• True

• False

The future value of money is the amount of money you would need to deposit today in order to accumulate a specific amount in the future.

• True

• False

Online banks are not subject to the same laws and regulations as traditional banks.

• True

• False