WorksheetsPersonal Finance EMPA Review
Total questions: 40
Worksheet time: 21mins
Name
Class
Date
1.
This type of bank operates their branches and makes their wide variety of services available across the country
a)
National Bank
b)
Regional Bank
c)
Online Bank
d)
Credit Union
2.
This type of bank operates with no brick and mortar branches and is typically able to offer higher rates on it's products
a)
National Bank
b)
Regional Bank
c)
Online Bank
d)
Credit Union
3.
What kind of fee could you be charged when you spend more money from your checking account than you have.
a)
Monthly Maintenance Fee
b)
Low Balance Fee
c)
Overdraft Fee
d)
Late Fee
4.
What is the main purpose of a checking account and what are some features?
a)
Used for long-term savings, high interest rates, limited withdrawals
b)
Used for everyday transactions, easy access, typically no interest
c)
Used for short term savings, earns interest, strict withdrawal limits
d)
Investment growth, periodic withdrawals, tiered interest rates
5.
What is the main purpose of a savings account and what are some features?
a)
Used for long-term savings, high interest rates, limited withdrawals
b)
Used for everyday transactions, easy access, typically no interest
c)
Used for short term savings, earns interest, strict withdrawal limits
d)
Investment growth, periodic withdrawals, tiered interest rates
6.
What are the components of a Certificate of Deposit (CD)?
a)
Short-term loan, flexible interest rates, unlimited withdrawals
b)
Variable-term deposit, variable interest rate, unlimited withdrawals
c)
Open-ended deposit, variable interest rate, no withdrawal limits
d)
Fixed-term deposit, fixed interest rate, limited withdrawals
7.
What are the components of a Money Market Account (MMA)?
a)
Flexible interest rates, check-writing privileges, tiered interest rates
b)
High-interest savings, strict withdrawal limits
c)
Short-term loan, flexible interest rates, unlimited withdrawals
d)
Fixed-term deposit, fixed interest rate, limited withdrawals
8.
What is compound interest?
a)
Interest calculated only on the initial principal
b)
Interest calculated on both the initial principal and the accumulated interest
c)
A fixed interest rate over time
d)
Interest compounded quarterly for savings accounts
9.
What does APY mean? How does this affect your monthly interest?
a)
Annual Payment Yield; it doesn't impact monthly interest
b)
Annual Profitable Yield; it affects quarterly interest
c)
Annual Percentage Yield; it is used to calculate your monthly interest received
d)
Average Percentage Yield; it has no effect on monthly interest
10.
What is the FDIC? What does it do for you as a consumer?
a)
Federal Deposit Insurance Corporation; protects your deposits up to a certain limit
b)
Financial Data and Information Center; regulates interest rates
c)
Federal Depository Insurance Committee; guarantees high-interest rates
d)
Financial Documentation and Information Control; audits banks' financial records
11.
Why is it important to research different products across different banks
a)
It ensures consistent interest rates across all banks
b)
It helps find the bank with the most convenient branch locations
c)
It allows you to compare account fees, interest rates, and features
d)
It minimizes the need for diversification in your financial portfolio
12.
This is the amount of money a person makes after taxes and deductions are taken out of their paycheck,
a)
Gross Income
b)
Net Income
13.
This is the amount of money a person makes before taxes and deductions are taken out of their paycheck.
a)
Gross Income
b)
Net Income
14.
Putting your money to work in financial instruments such as stocks, bonds, and mutual funds is a form of
a)
saving your money
b)
investing your money
c)
borrowing money
15.
An investment that represents a loan to a corporation or government is a
a)
Stock
b)
Bond
c)
Mutual Fund
d)
Credit Card
16.
An investment that represents an ownership in a company or corporation is a
a)
Stock
b)
Bond
c)
Mutual Fund
d)
Credit Card
17.
An investment that is comprised of other, different types of investments and where money is pooled together is a
a)
Stock
b)
Bond
c)
Mutual Fund
d)
Credit Card
18.
One way to make money with stocks is when a company declares a(n) ___________, they are sharing their profits with their stockholders.
a)
Buy Back
b)
Option
c)
Dividend
d)
Stock Split
19.
The other way to make money with stocks is to buy them at a higher price and, once the market comes down, sell them for a lower price.
a)
True
b)
False
20.
When you invest in a bond, you become the _____________ and you expect to receive ____________ from the corporation or government.
a)
Borrower, dividends
b)
Borrower, interest
c)
Lender, dividends
d)
Lender, interest
21.
Mutual funds can typically be organized by what 3 things?
a)
Investment Objective
b)
Fund Manager
c)
Geographical Market
d)
Industry Focus
22.
Mutual funds are managed by who?
a)
Fund Managers
b)
Investment Advisors
c)
Financial Advisors
d)
Bank Directors
23.
Joe invested $1,000 in Slice Pizza Corp. in 2022 and sold the shares and received a total of $1,200 one year later. What is his return on investment?
a)
16%
b)
-16%
c)
20%
d)
-20%
24.
Financial risk is the possibility that an asset will fail to produce a return or will lose value over time.
a)
True
b)
False
25.
When an investment cannot be sold easily, this type of investment risk is called:
a)
Capital Loss Risk
b)
Default Risk
c)
Inflation Risk
d)
Liquidity Risk
26.
The loss of part or all of an investment is called this type of investment risk:
a)
Capital Loss Risk
b)
Default Risk
c)
Inflation Risk
d)
Liquidity Risk
27.
When the rate of return is less than the rate of inflation, this type of investment risk is called:
a)
Capital Loss Risk
b)
Default Risk
c)
Inflation Risk
d)
Liquidity Risk
28.
When the borrower fails to make full and timely payments, this type of investment risk is called:
a)
Capital Loss Risk
b)
Default Risk
c)
Inflation Risk
d)
Liquidity Risk
29.
In this type of investment account, funds may be taken out at any time and are typically used for short to mid term investing goals
a)
401(k) account
b)
Individual Retirement Account (IRA)
c)
Brokerage Account
d)
Roth IRA
30.
In this type of retirement account, taxes are deferred until you withdraw the funds during retirement and your employer may give you a match up to a certain %
a)
401(k) account
b)
Individual Retirement Account (IRA)
c)
Roth IRA
31.
In this type of retirement account, investments are made with after tax money and funds are not taxed when you withdraw them during retirement.
a)
401(k) account
b)
Individual Retirement Account (IRA)
c)
Roth IRA
32.
Borrowing money to make purchases now and pay it back later is known as credit
a)
True
b)
False
33.
This type of credit is also called installment credit
a)
Open-ended Credit
b)
Close-ended Credit
34.
This type of credit is also called revolving credit
a)
Open-ended Credit
b)
Close-ended Credit
35.
Typically the lower the credit score, the lower the interest rates offered to you will be
a)
True
b)
False
36.
When loan is backed by collateral, if a borrower defaults on the loan, the lender could take that collateral and liquidate it to pay themselves back. This is known as a
a)
Restructured Loan
b)
Secured Loan
c)
Unsecured Loan
d)
Trust Loan
37.
The amount of money that must be paid every month to satisfy the terms of the loan is the
a)
Principal
b)
Loan Term
c)
Interest Rate
d)
Loan Payment
38.
The original amount of money that is being borrowed for a loan is called the
a)
Principal
b)
Loan Term
c)
Interest Rate
d)
Loan Payment
39.
This is what the borrower has to pay in order to borrow the money; a total amount expressed as an annual percentage
a)
Principal
b)
Loan Term
c)
Interest Rate
d)
Loan Payment
40.
The amount of time that the borrower has to repay the loan is known as the
a)
Principal
b)
Loan Term
c)
Interest Rate
d)
Loan Payment
100 %
