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WorksheetsBanking TEST
Total questions: 63
Worksheet time: 59mins
Which of the following is NOT a common feature of a financial institution?
access to ATMs
investment trading
direct deposit
debit cards
Which of the following is NOT a common feature of a financial institution?
direct deposit
paper checks
access to investment advice
checking and savings accounts
Which of the following statements about check cashing companies is TRUE?
They have limited operating hours during the day.
They sometimes offer free services.
They charge high fees.
They delay when you can access your cash.
Savings accounts typically offer more interest than what type of account?
retirement account
money market account
checking account
certificate of deposit (CD)
Which type of bank account is best for everyday transactions?
checking account
savings account
money market account
certificate of deposit (CD)
A savings account that compounds interest daily will earn a higher return than a savings account that pays simple interest daily.
True
False
Which savings account will earn you the most money?
one that compounds interest daily
one that compounds intrest monthly
one that earns simple interest daily
one that earns simple interest monthly
Why is it important to reconcile your bank statements?
to avoid spending more than what is in your account
to detect any errors in your account
to determine if you were charged any fees
all of the above
How can you avoid spending more than what is in your bank account?
Check your bank statement once a month.
Ask your financial institution to notify you when you are close to $0 in your account.
Keep your own records to compare with your financial institution's records.
none of the above
What should you do before you withdraw money from the ATM?
Ask someone nearby for help using the ATM.
Find a hidden ATM so no one will see you withdraw money.
Inspect the ATM to make sure it wasn't tampered with.
Share your pin number with trusted friends so you don't forget it.
Which statement is true?
If there is a mistake on one of your bank accounts, there is nothing you can do about it.
If there is a mistake on one of your bank accounts, you should wait 30 days as these issues tend to resolve themselves.
If there is a mistake on your bank account, you should contact your financial institution immediately.
none of the above
If there is a mistake with one of your bank accounts, who should you contact to resolve the issue?
the FDIC
no one, you can't resolve the issue
the local police station
your financial institution
If a person makes a deposit of $10,000 or more into a bank account, the bank must notify the
US Treasury Department
Federal Deposit Insurance Corporation. (FDIC)
State Banking Commission
Federal Reserve Board
When James received his paycheck, he planned to cash it at a check cashing store. You advise him to cash it at his own bank if possible. Why?
They typically require a two day waiting period before giving cash
They typically charge high fees
There is likely to be a ceiling on the size of the check he can cash
They generally require a co-signor
Travelers checks, often used for vacations:
Are equivalent to credit cards
Are free at most banks
Function as cash and are easily replaced if lost
Are FDIC insured
The phrase used for putting money into a savings account is:
Verifying the account
Balancing the account
Making a deposit
Making a withdrawal
The term used to describe the ease and speed with which you can convert savings or an investment to cash is:
Convertibility
Principal
Liquidity
Rate of Return
The best suggestion you gave a friend who is writing a check for the first time is:
Date the check because it is usually proof of payment
Use pencil to permit changes
Make the check payable to cash
Use the checkbook stub or register to keep a record of the date you write the check
Troy has $50 a month transferred electronically from his checking account to his savings account. This is an example of:
An installment payment
A savings plan
An ATM transaction
A debit card transaction
The Fed" is short for
The Federal Reserve System
Congress
FBI
The Federal Deposit Insurance Corporation
When a person is reconciling a checking account and notices that the balance in the checkbook does not match the balance on the statement from the bank, which action is it appropriate for the person to take first?
Determine that checks already written have cleared
Deposit sufficient funds to adjust the balance in the checkbook to match the bank's balance.
Adjust the balance in the checkbook so it is the same as the bank's balance.
Notify the bank in writing to adjust the statement
How can individuals be prepared for losing their job or having a large medical expense?
Maintain a checking account with sufficient funds
Pay credit card bills on time
Prepare a budget
Save at least three months of income
Banks use savings account deposits to:
Make their services and products attractive for new depositors
Pay for employee special projects
Give loans to consumers and businesses
Improve the quality of life in low-income communities
Money orders are:
Distributed by the Treasury Department
Available for no fee at banks and retail stores
A purchased certificate to pay a specified amount to a specific payee
A certified check used to pay a specified amount to a specific payee
Consumer finance companies, which are often advertised on TV, are also known as:
Banks
Savings and Loan Associations
Small Loan Companies
Purchase Loan Lenders
Which documents should be stored in a safe-deposit box?
Checkbook statements.
Copies of current and past budgets.
Current paycheck stubs.
Mortgage loan papers
The National Credit Union Administration (NCUA) insures accounts in:
Credit Union
Commercial Banks
Brokerage Firms
Savings Bank
Pat has a savings account and a car loan from a not-for-profit financial institution owned by its members. She is probably a member of what type of financial institution?
Credit union
Commercial bank
Savings and loan association
Investment club
This type of endorsement is used when you want to deposit an entire check into your account.
Full
Restrictive
Blank
This type of endorsement is used when you want to transfer the funds to someone else.
Full
Restrictive
Blank
This type of endorsement is your signature only, is the most common but least safe.
Full
Restrictive
Blank
With a minimum balance checking account, you
can only write one check a month.
you have to keep a certain balance or there are fees.
is great for high school students.
A check that has been written but has not yet been cashed or deposited by the payee is known as a(n)
bounced check
cleared check
outstanding check
A check that has been written and the money has been subtracted from your account is known as a(n)
bounced check
cleared check
outstanding check
A check that has been written more than available in the account is known as a(n)
bounced check
cleared check
outstanding check
This agency insures most commercial banks up to $250,0000.
BBB
IRS
FDIC
CPSC
ATM Fees occur when
you use your own bank's ATM
you use another bank's ATM.
you transfer funds to someone else.
The best reason for depositing money in a bank or credit union savings account instead of keeping your money “under the mattress” is that
It is insured.
It earns interest.
It is safer.
It grows.
Which of the following services will you NOT be able to access while banking online?
Withdraw cash
Transfer funds
Deposit checks
Order checks
What is the difference in a bank and a credit union?
Credit unions are member owned.
Banks are non-profit
Credit unions are for profit
Banks deal with less cash than credit unions.
Which business charges large fees to cash payroll and government checks to people who do not have a bank account?
Check Cashing Centers
Title Loan Centers
Rent-a-Center
Credit Unions
What should you include when you are writing a check?
Date, Payee, Amount, and Signature
Amount, Payee, Signature, check number
Endorsement, Amount, Signature
Date, Amount, Signature
What are direct deposit, electronic funds transfers, and automatic monthly payments features of?
Electronic banking
Check 21
Functions of the Federal Reserve
Pay yourself first
Who insures bank deposits?
Federal Deposit Insurance Corporation (FDIC)
National Credit Union Administration (NCUA)
Federal Reserve
U.S. Treasury Department
Who insures credit union deposits?
Federal Deposit Insurance Corporation (FDIC)
National Credit Union Administration (NCUA)
Federal Reserve
U.S. Treasury
The FDIC insure an account up to $250,000.
True
False
Monthly bank report that states the money deposited and withdrawn throughout the month that is sent from the bank.
WALL STREET JOURNAL
BANK STATEMENT
SCHOOL STAEMENT
CHECKING REPORT
An important consideration when saving money for emergencies is:
high growth potential
high degree of safety and liquidity
diversification
return on investment
An example of a fixed expense is:
Entertainment
Apartment Rent
Restaurants
Vacations
Expenditures that remain constant from one time period to another are:
Variable expenses
Current expenses
Fixed expenses
Steady assets
Financial plans need to:
include income but not expenses
be changed during different stages in life
include income and eliminate risk
to be approved by an accountant
Electricity and food expenditures are:
variable expenses that change from one period to another
discreet expenses that do not have to be paid monthly
fixed expenses that remain the same from one period to another
personal expenses for an individual or family
A good example of a well-stated financial goal is:
Buy a $25,000 car
Pay off $5,000 in credit card debt in two years
Buy a house
Become financially independent
