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WorksheetsREVIEW Money Matters Fall 25
Total questions: 71
Worksheet time: 41mins
What is personal finance primarily concerned with?
Managing an individual's financial decisions
Managing a business's financial decisions
Managing a government’s budget
Managing a nonprofit’s donations
Which of the following is a fundamental belief that shapes and influences financial behaviors and decisions?
Financial goals
Financial strategies
Financial values
Financial products
What is the primary focus of personal finance?
Increasing national GDP
Making decisions that align with personal values and goals
Following a universal method for managing finances
Avoiding all forms of debt
How do economic conditions influence financial values and practices?
They influence spending and saving behavior
They determine the fixed cost of goods
They set the terms for all financial transactions
They create personal financial goals
Which cognitive bias describes valuing something more just because you own it?
Loss aversion
Sunk cost fallacy
Endowment effect
Anchoring bias
What is cognitive bias?
What does the rational choice theory suggest about how individuals make decisions?
They make decisions based on gut feelings and emotions.
They make decisions through rational calculations to maximize their self-interest.
They follow the actions and opinions of a group.
They make decisions based on mental shortcuts and cognitive biases.
What term describes the tendency to follow the actions and decisions of a group?
Herd mentality
Anchoring bias
Mental accounting
Rational choice theory
What does the sunk cost fallacy lead individuals to do?
Justify further investments based on previously incurred costs
Place undue emphasis on the first piece of information received
Value something more because they own it
Objectively withdraw from underperforming investment if a very large amount of money is invested.
Which form of money is described as the official form in active circulation within a country?
Currency
Commodity Money
Fiat Money
Digital Currency
Select an answer from the options below.
The dollar
Precious metals
Cryptocurrencies
Currency
What problem does the characteristic of limited supply in money help to prevent?
A. Inflation
B. Durability issues
C. Divisibility problems
D. Uniformity discrepancies
How does money act as a medium of exchange?
By maintaining its value over time
By being accepted in exchange for goods and services
By providing a standard measure for goods and services
By being durable and portable
Which of the following is considered "legal tender"?
Digital wallets
Debit cards
Cash
Why might a merchant prefer an EFT over a check?
Reduces the risk of fraud and theft
Involves no transaction fees
Offers immediate access to cash
Is accepted universally
Which payment method combines the ease of electronic transactions with wide acceptance in retail and online settings?
Cryptocurrency
Checks
Debit cards
ACH transfers
Which method of financial exchange is least likely to be accepted for an online purchase?
Cash
Debit cards
Credit cards
Digital wallets
Why might a consumer prefer using a digital wallet?
No need for a bank account
Convenience and enhanced security
What is a major drawback of using wire transfers compared to ACH transfers?
Higher fees
Slower processing time
More security risks
Limited to small transactions
What is the primary risk associated with debit cards if they are lost or stolen?
Can only spend up to the available amount
Limited merchant acceptance
Unauthorized use leading to financial loss
High interest rates will compound
What is a key difference between a debit card and a credit card?
Debit cards allow you to make purchases on credit, while credit cards deduct money directly from your bank account.
Debit cards deduct money directly from your bank account, while credit cards allow you to make purchases on credit.
Debit cards offer rewards like cash back and travel points, while credit cards do not.
Debit cards require a credit check for approval, while credit cards do not.
What are the three critical functions that money must fulfill?
Medium of exchange
Store of value
Unit of account
Which of the following best describes money?
Medium of exchange, store of value, unit of measure
Medium of exchange, unit of measure, durability
Medium of exchange, unit of account, means of storage
Medium of exchange, store of wealth, unit of measurement
Which of the following best describes commodity money?
A. Money that has no intrinsic value and is backed by trust in the issuer
B. Money that has intrinsic value due to its physical properties and usefulness
C. Money that is only used for transactions and not stored for value
D. Money that is backed by the gold standard
What is the main difference between money and currency?
Currency is a broader concept that includes all forms of money
Money is physical while currency is digital
Currency is the official form of money in active circulation within a country
Money is issued by the government while currency is not
What is the gold standard?
A. A system where paper money is backed by silver
B. A system where a country's currency is tied to a certain quantity of gold
C. A system where money has no intrinsic value
D. A system where fiat currency is used
Why is paper currency considered legal tender?
Because it is made from special paper that gives the currency value
Because it has intrinsic value
Because the government officially sanctions it for payments
Because it can be easily counterfeited
What is a banknote?
A. A type of gold coin
B. A promissory note and legal tender issued by a government
C. A form of digital currency
D. A precious metal used as money
What does the term "counterfeit" refer to?
Legal reproduction of currency by the government
The production of digital currency to represent physical currency so it can be used in digital transactions
The storage of gold and silver
The illegal imitation or reproduction of currency or goods
What is one primary role of banks?
To store and safeguard deposits
To print currency
(No option provided)
(No option provided)
What is the primary way banks make money?
Charging high fees for account services
Charging interest on loans
Selling stocks and bonds
Receiving government subsidies
What does FDIC insurance protect against?
Identity theft
Stock market crashes
Loan defaults
Bank failures
What type of account is most likely to earn interest?
Checking account
Savings account
Debit card account
Credit card account
What is interest?
A service fee for using an ATM to withdraw money from a deposit account
The cost of borrowing money, usually expressed as a percentage
A penalty for late payments
A reward for opening a new account
What type of account typically offers the most immediate access to funds?
Savings Account
Money Market Account (MMA)
Checking Account
Certificate of Deposit (CD)
What is a check?
A dated and signed form of payment instructing a bank to pay a specific amount
An electronic transfer of funds
A payment method that involves sending cash to an individual or company
A way to transfer money using a mobile app
What information is required for a direct deposit to work?
Social Security number and account number
Debit card number and PIN
Routing number and account number
Bank’s name and branch address
What is the function of online bill pay?
A penalty incurred if a loan payment is late
The cost (or income) of borrowing (from loaning) money
A charge for opening a bank account
An electronic transfer of funds
Select an answer from the options below.
Provides high interest rates on deposits
Allows users to pay and manage their bills electronically
It allows account holders to instantly send money to vendors
Automatically deposits paychecks into an account
What is an ATM?
A. A method for direct deposits
B. A type of loan offered by banks
C. A way to order checks and debit cards directly from the bank
D. An electronic banking outlet for basic bank transactions
How does the FDIC protect checking accounts?
Provides high interest rates on all deposit accounts
Offers guarantees on all bank loans up to $250,000 to ensure a bank run does not occur
Reimburses overdraft fees
Insures deposits up to $250,000 per unique depositor per insured bank
What is liquidity?
The interest earned on a savings account
The ability to easily borrow money via a loan
The ease and speed by which an asset can be converted into cash
(No option provided)
What fee is charged when an account holder spends more than is available in their account?
ATM fee
Monthly service fee
Check printing fee
Overdraft fee
What is required to open a checking account? Select an answer from the options below.
Birth certificate, Government-issued photo ID, proof of employment, high school diploma
Government-issued photo ID, Social Security number, proof of address, initial deposit
Debit card, PIN, credit score, vehicle registration
Passport, birth certificate, utility bill, government-issued photo ID
What type of endorsement is used if a check should only be deposited and not cashed?
A. Blank endorsement
B. Restrictive endorsement
C. Endorsement in full
D. Special endorsement
What is a deposit slip used for? Select an answer from the options below.
To withdraw money from an account
To deposit money into an account
To transfer money between accounts
To pay a bill
What information is found at the bottom left corner of a check?
The account number
The routing number
The check number
The amount in word form
Which field on a check indicates the individual or organization to whom the check is payable?
The Memo field
The Date field
The "Pay to the order of" field
The Amount field
Which type of payment method is most comparable to physical cash when used?
Debit card
Blank endorsed check
Credit card
Restrictive endorsed check
Which type of deposit account is primarily designed for frequent transactions?
Savings account
Money market account
Checking account
Certificate of deposit
Which account type typically has the highest interest rate among the listed options?
Checking Account
Savings Account
Money Market Account (MMA)
Certificate of Deposit (CD)
Why might a bank offer higher interest rates on deposits during periods of low inflation?
To increase their liquidity reserves
To attract more customers from competitors
Because of low inflation expectations
Due to higher demand for loans
What is a common limitation of both savings accounts and Money Market Accounts (MMAs)?
Limited number of withdrawals per month
No interest earned
No FDIC insurance
High penalty fees for early withdrawal
What is the primary function of the Federal Reserve's Discount Rate?
To set the interest rates for savings and certificate of deposit accounts
To control the amount of reserves banks hold
To set the interest rate for banks borrowing short-term funds
To determine the inflation rate
What is the primary purpose of a bank statement?
To outline all account transactions in a given month
To provide investment advice on which deposit accounts are best
To serve as a formal tax return document to be submitted to the IRS
To offer promotional offers
Which of the following is NOT a fundamental element of a bank statement?
Starting balance
Credit score
Deposits
Withdrawals
What does the term "canceled check" refer to?
A check that has been voided by the account holder
A check that has been lost
How does a bank reconciliation help an account holder?
By providing investment opportunities
By cleaning up account records in preparation for applying for a new loan
By issuing new credit cards
By ensuring their bank records match their own transaction records
What could cause a bank balance and check register balance to not agree?
A. A change in bank policies
B. Outstanding checks
C. New bank branch openings
D. Introduction of new banking products
What does NSF stand for in banking terms?
New Savings Fund
National Security Fund
No Savings Fund
Non-Sufficient Funds
How is the ending balance on a bank statement calculated?
What is the definition of income?
Money an individual or business earns or receives as the result of economic activity.
Money received from government transfer payments.
Money inherited from family members.
Money an individual or business saves after paying all non discretionary expenses.
Which of the following is an example of earned income?
A. Interest from a savings account.
B. Dividends from stocks.
C. Wages from a job.
D. Rent from a tenant.
How is overtime pay calculated according to the Fair Labor Standards Act (FLSA)?
At least 25% more than an employee’s normal wage.
At least 50% more than an employee’s normal wage.
The same as the employee’s normal wage.
Double the employee’s normal wage.
What type of income is a commission?
Earned income.
Passive income.
Portfolio income.
Gift income.
Which form of income is primarily received from government programs?
Unearned income
Earned income
Passive income
Transfer payment
Which type of income would a person receive from renting out an apartment?
Wages
Dividends
Capital gains
Transfer payments
Which type of income would a person receive from renting out an apartment?
Earned income
Transfer payment
Salary
Passive income
If a person earns a salary of $75,000 per year and is paid semi-monthly, how much is paid each pay period?
$3,000.00
$2,083.33
$3,125.00
What is a bonus in the context of employee compensation?
The rate of working for oneself as a freelancer or the owner of a business.
An hourly wage for overtime work.
A lump-sum payment to an employee based on achieving certain performance-oriented goals.
Money paid to an employee as a percentage of revenue they helped generate.
What is a common form of income for self-employed individuals?
Earnings from freelancing.
Dividends from investments.
Wages from an employer.
Transfer payments.
