WorksheetsUnit Test Review for Checking & Savings
Total questions: 26
Worksheet time: 13mins
The ________ a number on the bottom of a check that identifies the account's financial institution.
ABA ROUTING NUMBER
ACCOUNT NUMBER
CHECK NUMBER
TRANSACTION CODE
An ________ is a computer terminal activated by a magnetically encoded bank card, allowing consumers to make deposits and other transactions.
ATM
Computer
Printer
Scanner
When a deposit is made but not listed on the bank statement, it is called an ________.
OUTSTANDING DEPOSIT
BANK ERROR
POSTED DEPOSIT
CLEARED DEPOSIT
A ________ is a fee the bank imposes for maintaining your account.
SERVICE CHARGE
MAINTENANCE FEE
ACCOUNT FEE
BANK FEE
A check that cannot be processed because the account has insufficient funds is known as a ________.
BOUNCED CHECK
CASHED CHECK
DEPOSITED CHECK
ENDORSED CHECK
A ________ is a savings alternative where money is left for a specific period to earn a higher rate of interest.
CERTIFICATE OF DEPOSIT (CD)
SAVINGS ACCOUNT
CHECKING ACCOUNT
MONEY MARKET ACCOUNT
________ is the cost of using money, paid by banks to depositors and by borrowers to lenders.
INTEREST
PRINCIPAL
DIVIDEND
RENT
________ interest is computed by adding interest to the principal, then recalculating the interest on this new amount.
COMPOUND
SIMPLE
FIXED
VARIABLE
An ________ is a retirement savings account with penalties for early withdrawal before age 59 ½.
IRA
401(k)
Roth IRA
Savings Account
A ________ account offers higher interest rates than a regular savings account but requires a minimum balance.
MONEY MARKET
CHECKING
CERTIFICATE OF DEPOSIT
SAVINGS
Which is NOT the main purpose of a debit card?
To write checks
To withdraw money from an ATM
To make purchases with money electronically deducted from your checking account
To deposit cash into your account
What is an endorsement in banking terms?
A service charge by the bank
A printed bank statement
A signature on the back of a check transferring ownership
An ATM transaction
Which organization insures accounts up to $250,000 at U.S. financial institutions?
FDIC
ATM
IRS
ABA
What is the difference between a cancelled check and an outstanding check?
Cancelled check has been cashed; outstanding check has not been cashed
Cancelled check is not valid; outstanding check is valid
Cancelled check is written to oneself; outstanding check is written to someone else
What does reconciliation in banking mean?
Writing a new check
Balancing your bank statement with your check register
Closing a bank account
Making a deposit
What is the principal in financial terms?
The interest earned on savings
The amount of money invested, saved, or borrowed
The rate at which interest is calculated
The penalty for withdrawing funds early
Which formula is used to calculate compound interest?
A) Interest = Principal x Rate x Time
B) A = P(1+r/n)(nt)
C) 72 / Interest Rate
D) Principal x Rate / Time
The Rule of 72 is used to estimate:
The time it takes to double an investment
The interest rate needed to double money in a certain time
Both A and B
Neither A nor B
A 401K plan is primarily used for:
Emergency savings
Retirement savings with tax benefits
Purchasing bonds
Daily transactions
Which type of account usually requires a minimum balance and limits the number of transactions?
Savings account
Money market account
Checking account
Certificate of Deposit (CD)
Explain the process of making a deposit at a bank.
Fill out a deposit slip, endorse the check, and hand it to the teller.
Write a withdrawal slip and give it to the teller.
Just hand over the cash to the teller without any paperwork.
Use the ATM to withdraw cash.
A person might choose to use online banking instead of visiting a physical bank because:
it is more convenient and accessible.
it offers better interest rates.
it provides face-to-face interaction.
it requires no internet connection.
The role of the Federal Deposit Insurance Corporation (FDIC) in the banking industry is to:
Insure deposits in banks and thrift institutions
Regulate the stock market
Provide loans to small businesses
Manage the federal budget
The difference between simple interest and compound interest is:
Simple interest is calculated on the principal amount only, while compound interest is calculated on the principal amount and also on the accumulated interest.
Simple interest is calculated on the accumulated interest, while compound interest is calculated on the principal amount only.
Simple interest and compound interest are calculated in the same way.
Simple interest is always higher than compound interest.
Someone might choose to invest in a Certificate of Deposit (CD) instead of a regular savings account because:
CDs typically offer higher interest rates than regular savings accounts.
CDs provide more liquidity than regular savings accounts.
CDs have no penalties for early withdrawal.
CDs are more flexible in terms of deposit amounts.
The Rule of 72 helps individuals plan their savings and investments by:
Estimating the time it takes for an investment to double at a fixed annual rate of interest.
Calculating the exact amount of interest earned over a period of time.
Determining the best investment strategy for maximum returns.
Providing a detailed analysis of market trends.
