WorksheetsW.I.S.E. Review #1
Total questions: 36
Worksheet time: 20mins
The most liquid type of investment is
A corporate bond
A certificate of deposit
Real estate holding
A money market account
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 Reverse Bank
Doug wants to buy a car in two months but does not have enough money. What is the best way for Doug to get the money he needs?
Purchase a certificate of deposit
Take out a cash loan
Open a money market account
Apply for a thirty year mortgage
Patty is selling her car through a newspaper advertisement. When she finds a buyer, she wants a form of payment that is guaranteed to be good. Which form of payment should she avoid?
Cash
Certified Check
Cashiers Check
A check
Joan wants to open a checking account and wonders if checking accounts pay interest. How would you answer her question?
All checking accounts pay interest
Some types of checking accounts pay interest
Checking accounts never pay interests
Checking accounts pay interest if the account balance does not fall below $300.00
Matthew (16) has opened a checking account. He is surprised to find that though he is getting a written bank statement each month he is not getting his cancelled checks returned. Matthew should be aware that the reason should be that the reasons cancelled checks are NOT returned is to
Protect him from providing opportunities for forgery.
Insure that he does not receive important materials he is likely to lose.
Lessen the Banks need to maintain records of check transactions.
Save the bank money associated with returning copies of these checks.
You have a checking account balance of $100 and you deposit a personal check of $200 from your brother into your checking account. When will you be able to withdraw $150 cash?
The same day as the $200 deposit
3-7 days later, depending on your banks check clearance policy
After receiving a checking account statement at the end of the month
On the day you make your next deposit
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
Which documents should be stored in a safe-deposit box?
Checkbook statements
Copies of current and past budgets
Current paycheck stubs
Mortgage loan papers
Items you would keep in a safe deposit box (a) (b) (c) (d)
Which financial product may pay a dividend?
Remember a Dividend is: a distribution of earnings, often quarterly, by a company to its shareholders in the form of cash or stock reinvestment
Savings account
Money market account
Certificate of deposit
Common stock
the phrase used for putting money into a savings account is:
Verifying the account
Balancing the account
Making a deposit
Making a withdrawl
Financial services and products generally offered by banks and credit unions include:
Real estate listings
Savings and loans
Legal services
Business plans
Marquan has $50 a month transferred electronically from her checking account to her savings account. This is an example of
An installment plan
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
Money orders are:
A purchased certificate to pay a specified amount to a specific payee
What action should a person take who must make a tuition payment at the end of August each year?
Decide how much money will be needed and then place 1/12th of that amount in a separate account each month.
Divide the total amount of money that will be needed into 12 equal parts and invest that amount in stocks.
Obtain a short-term collateralized loan for the needed amount of money.
Plan to open a new credit card account that will be used to charge the needed amount of money.
A blank endorsement on a check: (a)
A bank Certificate of Deposit (CD) is a:
Savings instrument that requires a deposit for a period of time during which the saver can withdraw money from the plan at any time with a penalty.
Savings instrument that requires a deposit for a period of time during which there is a penalty for withdrawals
Cash deposit in a savings account that earns interest
Certificate for deposits that are issued for half the face vaule
When can you withdrawal from a Certificate of Deposit (CD) without receiving a penalty?
Anytime!
Depending on the time length, only once.
Depending on the time length, twice
Not until the time length is over
Consumer Finance companies, which are often advertised on TV, are also known as:
Banks
Savings and loan associations
Small loan companies
Purchase loan lenders
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 quality of life in low-income communities
Marquan is depositing $20 in cash and a check for $50. On the checking account deposit slip, the person should
include the reason that both the cash and a check are being deposited.
indicate what bank issued the check that is being deposited.
indicate the amount of money that is currently the checking account as well as in savings account to cover the check.
list the cash deposit separately from the check as well as the total of the deposit.
When James received his paycheck, he planned to cash it at a check cashing store. You advies him to cash it as his own bank ig possible. Why?
They typically require a two day waiting period before giving the cash
They typically charge high fee
There is likely to be a ceiling on the size of the check that he can cash
They generally require a co-signor
The National Credit Union Administration (NCUA) insures accounts in:
Credit Unions
Commercial Banks
Brokerage Firms
Savings Banks
Which financial product typically pays the highest rate of interest?
Savings account
Money market account
Certificate of deposit
Common stock
Tasia has a savings account and a car loan from a not-for-profit financial institution owned by members. She is probably a member of what type of financial institution?
Credit Union
Commercial Bank
Savings and Loan Association
Investment Club
The best reason for depositing money in a bank or credit union savings account instead of a keeping your money "under the mattress" is that:
Money deposited in a savings accounts are F.D.I.C. insured
Most savings accounts earn a guaranteed rate of interest
Most savings accounts come with a free credit card
Money in a savings account can be accessed any time during the day or night
Which is the best example of a way to reduce fees paid for ATM transactions?
When making supermarket purchases wit ha debit card, a person adds $50 in cash to the transaction instead of using an ATM machine.
When using an ATM machine, a person takes only $20 each time out of the ATM machine located in the neighborhood store.
A person uses any nearby ATM machine rather than going to a branch of the issuing bank to make ATM withdrawals.
A person uses any convenient ATM machine but only at night and on the weekends.
Employees prefer direct deposits because:
There is a small fee for service
The danger of losing a paycheck is lightly reduced
The money is generally deposited in their checking account sooner than it would be if they had to deposit it in person
Direct deposits earn a higher rate of interest
Which financial product has the most predictable income?
Stock
Real Estate
Certificate of Deposit
(CD)
Option/ Future Contract
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
Which financial product can you buy for $25, is safe, and will be worth $50 at a future date?
Series EE Savings Bond
Certificate of Deposit (CD)
50 shares of ABC Co. Stock
ABC Co. Bond
Justin's savings account has earned a lot of interest. He wants to know if he must pay taxes on the interest earned. What would the IRS tell him?
Interest earned on savings accounts is not taxable
A sales tax will be charged on the interest earned
Savings account interest is taxable
If the interest is under $50, it is not taxable
The financial institution where Ms. Sanchez has her checking account will continue to pay out money for the checks she writes as long as:
She uses checks from her checkbook
The financial institution has sufficient funds
There is enough money in Ms. Sanchez's account to cover the amount of the checks
She maintains a good record of deposits and handles her account responsibily
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
