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WorksheetsBanking & Financial Services Unit 1 Review
Total questions: 111
Worksheet time: 2hrs 51mins
Name
Class
Date
1.
Which of the following is not a financial institution?
a)
A power company.
b)
A credit card company.
c)
A stock brokerage.
d)
An insurance company.
2.
Which of the following best describes online banking?
a)
Enables customers to conduct financial transactions on a secure website operated by their bank.
b)
Takes the place of the ATM.
c)
Allows customers to use their debit card to purchase things on the Internet.
d)
Access to online banking privileges is limited to those with commercial accounts.
3.
What is the role of the Federal Deposit Insurance Corporation (FDIC)?
a)
Insures each depositor in the case of bank failure.
b)
Regulates investment banks.
c)
Issues money to stabilize the economy.
d)
Guarantees mortgage loans.
4.
Which of the following types of banks does not have a branch you can visit?
a)
An Internet bank.
b)
An interstate bank.
c)
A unit bank.
d)
A national bank.
5.
What is the difference between a retail bank and a commercial bank?
a)
Retail banks serve consumers, and commercial banks serve businesses.
b)
Retail banks serve the needs of commercial banks.
c)
Retail banks serve businesses, and commercial banks serve consumers.
d)
Retail banks and commercial banks serve the same customers.
6.
Which of the following is not a non-depository financial institution?
a)
A savings and loan association.
b)
An investment bank.
c)
A securities firm.
d)
An insurance company.
7.
What is the difference between a savings account and a money market account?
a)
A money market account usually requires a greater initial deposit and pays higher interest.
b)
Savings accounts are only available to individuals.
c)
A savings account usually requires a greater initial deposit and pays higher interest.
d)
Money market accounts are only available to businesses.
8.
Which of the following is not true of payday lenders?
a)
Interest rates on payday loans are lower than most other loans.
b)
They offer short-term loans designed to cover a customer's expenses until his or her next payday.
c)
They are a type of consumer-finance company.
d)
Many payday customers are unable to pay their payday loan when it is due.
9.
Customers who make deposits are called _____.
a)
depositors
b)
bankers
c)
investors
d)
stockholders
10.
Which of the following is not true of credit unions?
a)
They offer savings accounts called share draft accounts.
b)
They are owned by their members.
c)
They are cooperatives.
d)
They are not-for-profit organizations.
11.
Which of the following is not an important duty of a trustee in settling an estate?
a)
Deciding to whom property should be distributed.
b)
Paying any debts of the estate.
c)
Managing the assets until the estate is completely settled.
d)
Preparing and filing tax returns.
12.
Which of the following is not an operating expense of a bank?
a)
interest
b)
equipment maintenance
c)
advertising
d)
employee salaries
13.
How did the Credit CARD Act of 2009 regulate over-limit transactions on credit cards?
a)
Requires cardholders to declare that they want over-limit transactions covered.
b)
Requires banks to offer over-limit transaction coverage on every credit card.
c)
Requires customers to pay a fee for over-limit transaction coverage.
d)
Makes over-limit transaction coverage illegal.
14.
Which are the two largest assets of banks?
a)
Loans and securities.
b)
Loans and fees.
c)
Fees and trusts.
d)
Securities and fees.
15.
Brokers are licensed to trade each of the following securities except _____.
a)
trusts
b)
treasury securities
c)
bonds
d)
common stock
16.
Computer software program loaded onto a smartphone, tablet, or other mobile device that allows the user to perform specific tasks.
a)
app
b)
unit bank
c)
retail bank
d)
reserves
17.
Electronic network for financial transactions that processes credit and debit transactions, processes checks, and transfers funds between banks.
a)
automated clearinghouse (ACH)
b)
app
c)
unit bank
d)
retail bank
18.
A computerized machine that provides a means of self-service banking; allows a customer to perform basic banking activities, such as withdrawing cash, viewing account balances, initiating cash advances, and making deposits.
a)
automated teller machine (ATM)
b)
automated clearinghouse (ACH)
c)
app
d)
unit bank
19.
A type of financial institution.
a)
bank
b)
automated teller machine (ATM)
c)
automated clearinghouse (ACH)
d)
app
20.
A type of insurance that covers a bank from losses due to robbery or theft.
a)
banker’s blanket bond
b)
bank
c)
automated teller machine (ATM)
d)
automated clearinghouse (ACH)
21.
A legal document issued by a federal and a state government that details how a bank is to be operated and how it will be regulated.
a)
charter
b)
banker’s blanket bond
c)
bank
d)
automated teller machine (ATM)
22.
A financial institution owned by investors that focuses on business customers, providing bank accounts along with specialized services such as foreign exchange, investment services, and capital loans; some also provide limited customer-oriented services, such as personal checking and savings accounts.
a)
commercial bank
b)
charter
c)
banker’s blanket bond
d)
bank
23.
A financial institution that oversees a nation’s monetary system by regulating banks, lending money when commercial banks are not able to, and controlling the money supply.
a)
central bank
b)
commercial bank
c)
charter
d)
banker’s blanket bond
24.
A card that enables customers to electronically access the funds in their accounts at an ATM or to pay for goods and services in stores or online.
a)
debit card
b)
central bank
c)
commercial bank
d)
charter
25.
A type of financial institution at which customers deposit money in order to withdraw it later.
a)
depository institution
b)
debit card
c)
central bank
d)
commercial bank
26.
Any exchange of money from one account to another through computer-based systems that is started by electronic means.
a)
electronic funds transfer (EFT)
b)
depository institution
c)
debit card
d)
central bank
27.
An independent federal agency established in 1933 that provides deposit insurance up to $250,000 for depositors in insured banks and thrifts in the case of bank failure.
a)
Federal Deposit Insurance Corporation (FDIC)
b)
electronic funds transfer (EFT)
c)
depository institution
d)
debit card
28.
Any organization or business that provides services related to money.
a)
financial institution
b)
Federal Deposit Insurance Corporation (FDIC)
c)
electronic funds transfer (EFT)
d)
depository institution
29.
An institution that acts as a go-between in financial transactions.
a)
financial intermediary
b)
financial institution
c)
Federal Deposit Insurance Corporation (FDIC)
d)
electronic funds transfer (EFT)
30.
A financial institution with no physical location or building that customers access from anywhere with an Internet connection; also known as an online bank.
a)
Internet bank
b)
financial intermediary
c)
financial institution
d)
Federal Deposit Insurance Corporation (FDIC)
31.
A type of financial institution that usually specializes in retail banking and does not operate internationally.
a)
interstate bank
b)
Internet bank
c)
financial intermediary
d)
financial institution
32.
A financial institution that provides services for businesses, such as raising capital through the stock market.
a)
investment bank
b)
interstate bank
c)
Internet bank
d)
financial intermediary
33.
A very large, often international bank whose primary customers are businesses, other banks, and governments.
a)
money center bank
b)
investment bank
c)
interstate bank
d)
Internet bank
34.
A financial institution with offices all over the country.
a)
national bank
b)
money center bank
c)
investment bank
d)
interstate bank
35.
Allows customers to conduct financial transactions on a secure website operated by their bank; also known as home banking.
a)
online banking
b)
national bank
c)
money center bank
d)
investment bank
36.
Allows for an immediate money transfer from one person to another.
a)
peer-to-peer payment (P2P)
b)
online banking
c)
national bank
d)
money center bank
37.
A type of financial institution that usually specializes in retail banking and does not operate internationally; also known as an interstate bank.
a)
regional bank
b)
peer-to-peer payment (P2P)
c)
online banking
d)
national bank
38.
A percentage of the bank’s funds that is kept to ensure that money will be available for customers and is not available for loans; also known as required reserves.
a)
reserves
b)
regional bank
c)
peer-to-peer payment (P2P)
d)
online banking
39.
A type of financial institution that provides services for customers, such as deposit accounts, mortgages, auto and personal loans, and credit cards.
a)
retail bank
b)
reserves
c)
regional bank
d)
peer-to-peer payment (P2P)
40.
A bank with one location, usually in a small town or rural area, that serves local customers, tends to invest locally, and knows the challenges of the local community.
a)
unit bank
b)
retail bank
c)
reserves
d)
regional bank
41.
Represents money a government or company has borrowed from the bondholder.
a)
bond
b)
transaction account
c)
stockholder
d)
stock
42.
Provides loans for businesses, such as retail stores.
a)
business finance company
b)
bond
c)
transaction account
d)
stockholder
43.
Formed by a manufacturer to provide loans so the manufacturer can easily sell its goods.
a)
captive finance company
b)
business finance company
c)
bond
d)
transaction account
44.
A financial institution owned by investors that focuses on business customers, providing bank accounts along with specialized services such as foreign exchange, investment services, and capital loans; some also provide limited customer-oriented services, such as personal checking and savings accounts.
a)
commercial bank
b)
captive finance company
c)
business finance company
d)
bond
45.
A fee, such as the kind charged by a stockbroker for placing an order.
a)
commission
b)
commercial bank
c)
captive finance company
d)
business finance company
46.
A business or organization that is owned by its members who cooperate to run the organization.
a)
cooperative
b)
commission
c)
commercial bank
d)
captive finance company
47.
A financial institution that provides many of the same services as banks and S & Ls, but owned by its members and run on a nonprofit basis.
a)
credit union
b)
cooperative
c)
commission
d)
commercial bank
48.
Provides high-interest personal loans to individuals who have poor credit.
a)
consumer finance company
b)
credit union
c)
cooperative
d)
commission
49.
Money placed or transferred into a bank account.
a)
deposit
b)
consumer finance company
c)
credit union
d)
cooperative
50.
Insurance that covers the deposits of customers in the case of a bank failure.
a)
deposit insurance
b)
deposit
c)
consumer finance company
d)
credit union
51.
Arranges for depositors to maintain their insured funds in the case of bank failure. Depository institutions pay premiums to this fund in order to pool their money and share risk.
a)
deposit insurance fund (DIF)
b)
deposit insurance
c)
deposit
d)
consumer finance company
52.
A customer who makes a deposit.
a)
depositor
b)
deposit insurance fund (DIF)
c)
deposit insurance
d)
deposit
53.
A contract designed to manage risk and make money.
a)
derivative
b)
depositor
c)
deposit insurance fund (DIF)
d)
deposit insurance
54.
Stockbroker who places orders for customers at commissions lower than full-service brokers and may offer only limited services.
a)
discount broker
b)
derivative
c)
depositor
d)
deposit insurance fund (DIF)
55.
A payment.
a)
dividend
b)
discount broker
c)
derivative
d)
depositor
56.
An independent federal agency established in 1933 that provides deposit insurance up to $250,000 for depositors in insured banks and thrifts in the case of bank failure.
a)
Federal Deposit Insurance Corporation (FDIC)
b)
dividend
c)
discount broker
d)
derivative
57.
Issues loans to both individuals and businesses in order to make a profit, also known as a loan company.
a)
finance company
b)
Federal Deposit Insurance Corporation (FDIC)
c)
dividend
d)
discount broker
58.
Any organization or business that provides services related to money.
a)
financial institution
b)
finance company
c)
Federal Deposit Insurance Corporation (FDIC)
d)
dividend
59.
Advises customers on which securities to buy and helps manage investments.
a)
full-service brokerage firm
b)
financial institution
c)
finance company
d)
Federal Deposit Insurance Corporation (FDIC)
60.
A for-profit business that primarily sells insurance.
a)
insurance company
b)
full-service brokerage firm
c)
financial institution
d)
finance company
61.
The person or thing covered by an insurance policy.
a)
insured
b)
insurance company
c)
full-service brokerage firm
d)
financial institution
62.
A financial institution that provides services for businesses, such as raising capital through the stock market.
a)
investment bank
b)
insured
c)
insurance company
d)
full-service brokerage firm
63.
A savings account that pays a higher interest rate and requires a higher minimum balance than a traditional savings account.
a)
money market account
b)
investment bank
c)
insured
d)
insurance company
64.
Established in 1970 to insure credit union deposits up to $250,000.
a)
National Credit Union Share Insurance Fund (NCUSIF)
b)
money market account
c)
investment bank
d)
insured
65.
A type of financial institution that does not accept deposits but accepts money from customers for the purpose of investing in business deals in order to spread risk and provide a means of investment.
a)
non-depository institution
b)
National Credit Union Share Insurance Fund (NCUSIF)
c)
money market account
d)
investment bank
66.
Instead of paying profits to shareholders, money made by not-for-profit credit unions is returned to members in the form of higher interest rates on savings accounts and lower interest rates on loans.
a)
not-for-profit
b)
non-depository institution
c)
National Credit Union Share Insurance Fund (NCUSIF)
d)
money market account
67.
Provides short-term high-interest loans designed to cover expenses until the borrower’s next payday.
a)
payday lender
b)
not-for-profit
c)
non-depository institution
d)
National Credit Union Share Insurance Fund (NCUSIF)
68.
Periodic payments made to purchase an insurance policy.
a)
premium
b)
payday lender
c)
not-for-profit
d)
non-depository institution
69.
A deposit account at a depository institution that earns interest and provides a safe place to store money.
a)
savings account
b)
premium
c)
payday lender
d)
not-for-profit
70.
A type of financial institution that helped customers save money by allowing small deposits and home loans; also known as a savings association or thrift institution.
a)
savings and loan association (S & L)
b)
savings account
c)
premium
d)
payday lender
71.
Financial instruments that pay interest or give the investor part ownership of the company; issued by investment banks.
a)
securities
b)
savings and loan association (S & L)
c)
savings account
d)
premium
72.
A type of financial institution involved in the trading of securities in financial markets; also called a brokerage firm, stockbroker, or bondbroker.
a)
securities firm
b)
securities
c)
savings and loan association (S & L)
d)
savings account
73.
A savings account at a credit union.
a)
share account
b)
securities firm
c)
securities
d)
savings and loan association (S & L)
74.
A checking account at a credit union.
a)
share draft account
b)
share account
c)
securities firm
d)
securities
75.
A security that gives the purchaser part ownership in the company, known as equity.
a)
stock
b)
share draft account
c)
share account
d)
securities firm
76.
An investor who expects to make a return from his or her investment in stock.
a)
stockholder
b)
stock
c)
share draft account
d)
share account
77.
A bank account that allows the owner to use it to pay a third party, such as a checking account.
a)
transaction account
b)
stockholder
c)
stock
d)
share draft account
78.
A fee charged to check an account balance at an ATM.
a)
account inquiry fee
b)
underwriting spread
c)
underwriting
d)
trustee
79.
Occurs when one company buys another company and sets itself up as the new owner.
a)
acquisition
b)
account inquiry fee
c)
underwriting spread
d)
underwriting
80.
Something owned by an individual or other entity.
a)
asset
b)
acquisition
c)
account inquiry fee
d)
underwriting spread
81.
The individual who receives financial protection from an insurance policy.
a)
beneficiary
b)
asset
c)
acquisition
d)
account inquiry fee
82.
Protected consumers from unfair and deceptive credit card practices and gave cardholders additional rights; enacted in 2009.
a)
Credit CARD Act
b)
beneficiary
c)
asset
d)
acquisition
83.
The property and possessions of an individual, which may include property, cars, money, or other assets.
a)
estate
b)
Credit CARD Act
c)
beneficiary
d)
asset
84.
Preparing for the transfer of assets after a client’s death.
a)
estate planning
b)
estate
c)
Credit CARD Act
d)
beneficiary
85.
An increase in income that occurs when a bank sells a security for more than its purchase price.
a)
gain
b)
estate planning
c)
estate
d)
Credit CARD Act
86.
A fee charged if a customer does not make a transaction within a specified period.
a)
inactivity fee
b)
gain
c)
estate planning
d)
estate
87.
A fee charged by a bank when there is not enough money in an account to cover a transaction.
a)
insufficient funds fee
b)
inactivity fee
c)
gain
d)
estate planning
88.
Provides protection from certain risks that can cause financial loss.
a)
insurance
b)
insufficient funds fee
c)
inactivity fee
d)
gain
89.
A fee charged for borrowing money.
a)
interest
b)
insurance
c)
insufficient funds fee
d)
inactivity fee
90.
Money that a bank pays to customers for the use of their money.
a)
interest expense
b)
interest
c)
insurance
d)
insufficient funds fee
91.
A stated cost for the use of borrowed money that is a percentage paid on top of the initial amount.
a)
interest rate
b)
interest expense
c)
interest
d)
insurance
92.
The ability of a financial asset to be quickly converted into cash without any financial loss; having enough cash available to meet normal withdrawals.
a)
liquidity
b)
interest rate
c)
interest expense
d)
interest
93.
The date on which a bond investor can receive the initial investment.
a)
maturity
b)
liquidity
c)
interest rate
d)
interest expense
94.
When two companies agree to combine.
a)
merger
b)
maturity
c)
liquidity
d)
interest rate
95.
An amount of money that is purchased in an exact amount payable to a specific party.
a)
money order
b)
merger
c)
maturity
d)
liquidity
96.
Costs incurred to keep a bank in business, such as utilities, rent, and wages.
a)
operating expense
b)
money order
c)
merger
d)
maturity
97.
A negative balance.
a)
overdraft
b)
operating expense
c)
money order
d)
merger
98.
Provides funds to cover a check written on an account with insufficient funds.
a)
overdraft program
b)
overdraft
c)
operating expense
d)
money order
99.
Plan that provides retirement income for the employees of a business.
a)
pension fund
b)
overdraft program
c)
overdraft
d)
operating expense
100.
Pertains to settling the financial affairs of a person after he or she has died. profit. When a bank’s income exceeds its expenses.
a)
probate law
b)
pension fund
c)
overdraft program
d)
overdraft
101.
When a bank’s income exceeds its expenses.
a)
profit
b)
probate law
c)
pension fund
d)
overdraft program
102.
The chance that an unfavorable event will happen to a person or property.
a)
risk
b)
profit
c)
probate law
d)
pension fund
103.
An individually secured container usually kept within a bank vault to store valuables.
a)
safe deposit box
b)
risk
c)
profit
d)
probate law
104.
A security that gives the purchaser part ownership in the company, known as equity.
a)
stock
b)
safe deposit box
c)
risk
d)
profit
105.
A fee charged by an ATM when cash is withdrawn, also known as a convenience fee.
a)
surcharge
b)
stock
c)
safe deposit box
d)
risk
106.
The buying and selling of securities by a broker.
a)
trading
b)
surcharge
c)
stock
d)
safe deposit box
107.
Services offered by banks related to cash management, such as accounting services, capital services, collections services, credit card services, and information services.
a)
treasury and cash management services
b)
trading
c)
surcharge
d)
stock
108.
A legal document that defines a customer’s assets and how those assets should be handled.
a)
trust
b)
treasury and cash management services
c)
trading
d)
surcharge
109.
The person or institution that controls financial assets for the customer.
a)
trustee
b)
trust
c)
treasury and cash management services
d)
trading
110.
When lenders analyze risks and set conditions on the loan.
a)
underwriting
b)
trustee
c)
trust
d)
treasury and cash management services
111.
The difference between the price paid by the investment bank and the price sold to the public.
a)
underwriting spread
b)
underwriting
c)
trustee
d)
trust
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