EPF Mid-term

David saved $2,000 from his summer job cleaning pools. Which of these account types would work best for him if he doesn't need access to the money for a number of years AND wants to earn the highest interest rate?

• Regular savings account

• Certificate of Deposit

• Checking account

• Money Market account

You are at the checkout counter at the local supermarket and use your debit card to pay for your groceries. Where does the money for this purchase come from?

• Your credit card company covers the cost

• It is deducted directly from your checking account

• Your credit card company provides you with a cash advance to cover the cost

• It is deducted from your credit card account

• Wait until your monthly statement arrives so you can check to see if those withdrawals are still there

• Wait a week as it is fairly common for the bank to catch mistakes like this

• Check your wallet to be sure your debit card has not been stolen. If you still have it, then you should not worry.

• Contact your bank immediately as it appears that your account may have been hacked

Which of the following transactions will REDUCE your checking account balance immediately?

• Writing your monthly rent check which you will mail tomorrow

• Using your debit card to pay for groceries at the supermarket

• Using your credit card to pay for your school books

• Depositing a check at a local bank branch

Which of these is NOT a benefit of buying a used car?

• Your car may be more prone to breakdowns since it is older

• Insurance costs will be lower since the car is older

• You save money on the purchase price thanks to former ownership

• Your car will depreciate slower than a brand new car

FDIC Insurance is...

• 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.

• Required if you want to do online or mobile banking.

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

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.

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

• Cover all of your wants and needs and save whatever is left over.

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

Which of these is a financial institution owned by the account holders?

• Payday lending shop

• Commercial bank

• Check cashing outlet

• Credit Union

Jessica gives her friend money to buy a cheeseburger since he forgot his wallet at home, but expects to be repaid. This represents the financial service of:

• Borrowing

• Investing

• Lending

• Saving

When you take money out of an account, it is called a

• Deposit

• Debit card

• Withdrawal

• Payment