Finance Quiz

What is fiat money?

• Money backed by gold or silver

• Money that has value because it is widely accepted

• Money that is not accepted by the government

• Money that is only used in foreign countries

What does it mean when the US dollar is described as legal tender?

• It must be accepted as payment

• It is backed by gold

• It is only used in the United States

• It is not accepted by banks

What is liquidity?

• The ability to convert something into cash easily

• The process of saving money in a bank

• The interest rate on a savings account

• The value of a currency compared to gold

What is a checking account?

• An account that earns high interest

• An account at a bank where you can deposit and withdraw money

• An account used only for investments

• An account that charges high fees for transactions

What does the Federal Deposit Insurance Corporation (FDIC) do?

• Insures every bank account up to $250,000

• Provides loans to individuals

• Sets interest rates for banks

• Issues credit cards to consumers

What is a personal check?

• A guaranteed form of payment

• A contract instructing your bank to make a payment

• A form of digital currency

• A type of savings account

What is OVERDRAFT protection?

• A service that prevents any transactions if funds are low.

• A feature that allows you to withdraw more money than you have.

• A bank service that pays a check or debit transaction even if funds are insufficient.

• A method to automatically save money from your account.

What is the purpose of setting up AUTO PAYMENT from your checking account?

• To increase your account balance.

• To avoid late fees by automatically paying bills.

• To receive interest on your savings.

• To prevent overdraft fees.

What should you do if a check you wrote gets stolen?

• Wait for it to clear.

• Issue a STOP PAYMENT with your bank.

• Write another check.

• Ignore it and hope for the best.

What is the best way to REDUCE ATM FEES?

• Use any ATM available.

• Use your own bank's ATM machines.

• Withdraw large amounts at once.

• Avoid using ATMs altogether.