Finance, Banking, and Insurance Worksheet

Suppose prices increase 4%, but your income stays the same. What will happen to your buying power?

• Your buying power will increase.

• Your buying power will decrease.

• Your buying power will stay the same.

• You will be able to buy more goods.

What is a reason to have an Individual Retirement Account (IRA)?

• To save for retirement with tax advantages and to have money for expenses when you reach 59 1/2 years old.

• To pay for daily expenses

• To increase credit card debt

• To avoid paying any taxes forever

If you put money in your savings before paying your bills, then you are...?

• Paying yourself first

• Ignoring your bills

• Spending recklessly

• Saving last

Before making a large purchase, you should:

• Spend without thinking

• Research and compare options

• Ignore your budget

• Buy the first thing you see

How do banks make money?

• By providing loans and charging interest

• By giving away money for free

• By only keeping money in vaults

• By printing their own currency

What is something you can do with online banking?

• Transfer money between accounts, set up automatic bill pay, direct deposit paychecks

• Buy groceries at a store

• Cook a meal

• Drive a car

If you have a $100,000 in your savings and the bank fails, how much of your money will be protected and by what insurance?

• $100,000 protected by FDIC insurance

• $50,000 protected by private insurance

• $200,000 protected by FDIC insurance

• None of your money is protected

Suppose a checking account is free with a minimum balance of $1,500, but the account earns no interest. What would be an important thing to consider?

• The opportunity cost of not earning interest on $1,500

• The number of checks you can write per month

• The color of the checkbook

• The location of the bank

If someone wins the lottery or a TV game show, what must they do?

• They must pay taxes on their winnings.

• They must return the prize.

• They must donate the prize to charity.

• They must refuse the prize.

The purpose of a restricted endorsement on a check is:

• To allow anyone to cash the check

• To limit how the check can be used or deposited

• To make the check invalid

• To increase the check amount