WorksheetsBehavioral Economics and Banking Quiz
Total questions: 21
Worksheet time: 43mins
All of the following are reasons to open a checking account EXCEPT...
Making it easier to pay bills
The ability to make purchases with a debit card
Access to cash at an ATM
Saving money for retirement
Tyreke has $5,000 to put into an account that earns compound interest. Which of the following is the BEST advice you can offer so that he can maximize interest?
It’s ok to open an account with a low interest rate as long as you deposit your money early
Deposit your money as early as possible in an account with the highest interest rate possible
Wait for interest rates to rise above 5%, otherwise compounding doesn’t have any effect
Compound interest will not have any effect at such a low dollar amount. Find different opportunities to earn interest on your savings.
What is the most frequently charged fee on checking accounts?
ATM fees
Overdraft fees
Monthly maintenance fees
Statement fees
All of the following are ways that you could potentially avoid a monthly maintenance fee on your account EXCEPT...
Meeting a monthly minimum balance requirement
Only banking online instead of using physical bank locations
Having both a checking and savings account with the same bank
Finding a bank that offers accounts with no monthly maintenance fee
All of the following are ways to avoid ATM fees EXCEPT...
Avoiding out of network ATMs
Finding a bank that reimburses you for ATM fees
Using your debit card instead of withdrawing cash to make a purchase
Withdrawing money from your savings account instead of your checking account
Keon receives a $1,000 paycheck. According to the 50/30/20 rule, how much should he put aside for saving?
$100
$200
$500
$1,000
What is a major benefit of the Pay Yourself First strategy?
It helps you budget all of your income for the month
It encourages you to prioritize saving money
It is a good way to build credit
It generates additional income to cover essential expenses
How much money should you try to save in your emergency fund?
3-6 days worth of expenses
3-6 weeks worth of expenses
3-6 months worth of expenses
3-6 years worth of expenses
Which of the following is an example of online bill pay?
Using a person-to-person app to repay your friend for dinner
Using a mobile payment service to purchase your groceries at a store
Having your bank send your rent to the landlord each month
Having your check direct deposited into your bank account
Which of the following statements is an advantage of online banking?
Once you set up online banking, your bank will waive overdraft, ATM, and monthly fees
Using online banking, you can request transfers, pay bills, and automate your savings without visiting the bank branch
Online banking is the only way you can make online purchases
If you set up online banking, your bank will also file your taxes for you automatically
All of the following are ways that you can keep your online bank account safe EXCEPT...
Only using private wifi to access your account
Turning on text alerts to monitor your account for large or potentially fraudulent transactions
Changing your password regularly using reasonably complex passwords
Banking with small banks and credit unions because they are less frequently the target of fraud
Naresh started a new job and is having some of his paycheck deposited directly into a savings account. Which of the following values BEST explains why Naresh does this on a regular basis?
Inner
Social
Physical
Financial
You overhear your friend Ginny say, "I made a budget for myself in my personal finance class and used my values to decide how I want to use my money." What does Ginny mean by this?
Ginny used the value of her bank account balance to decide how to use her money
Ginny asked her friends and family for advice to decide how to use her money
Ginny followed recommendations she saw on social media to decide how to use her money
Ginny identified what is important to her and used that knowledge to decide how to use her money
What are social values, as they pertain to money?
How you, personally, care and think about finances
How your family, friends, and community members impact your feelings about money
How companies and advertisement make you feel about money
How banks and other financial institutions treat you and your money
Behavioral economics...
Is a field of economics that studies people who make rational and objective decisions
Analyzes how different economies around the world behave over time
Tracks and examines stock market trends over a certain period of time
Combines economics and psychology to study why people behave the way they do in the real world
Cognitive bias is...
An error in the way we think that can influence our decisions
The desire to seek out information that confirms our existing beliefs
The belief that our abilities are better than they actually are
The concept of placing more value on an item when we own it
You go to a restaurant and order a big meal. Even though you’re full, you keep eating because it was expensive. This is an example of...
Mental Accounting
The Sunk Cost Fallacy
Fear of Missing Out
The Endowment Effect
Which of the following is TRUE about cognitive biases?
It is easy to recognize when cognitive biases are influencing our own decisions
There is rarely anything you can do to combat a cognitive bias’ influence
There are only a handful of cognitive biases that exist
Awareness is often the first step to overcoming the influence of a cognitive bias
Andrew wants to buy a specific model of a new car. He conducts research and finds many resources that highlight the benefits of that car model. Which cognitive bias might be influencing Andrew’s decision making?
Confirmation Bias
Hedonic Adaptation
The Sunk Cost Fallacy
Overconfidence
Mina wants to start using an investment app that all of her friends are raving about. She hasn’t done any research on the app, but she trusts her friends’ judgment. At home, Mina’s mom points out that Mina is being influenced by FOMO and herd mentality. All of the following are things Mina can do to overcome these cognitive biases EXCEPT...
Take time to reflect and identify why she is so eager to use the app
Watch a positive video about the app, download the app, and start using it that day
Ask people outside her friend group for their opinions and perspectives
Seek out reviews that talk about the disadvantages of using the app
Why do a lot of people choose to borrow excessively on credit cards?
