Exam 4: Managing Your Cash and Savings

Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement. -You make a promise to keep funds on deposit for a stated period of time when you open a [MMDA | CD].

Harry just received $2,000 for graduation.He plans on investing this money for five years at 8% compounded annually.If he accomplishes this,Harry will have in an ending balance of (Use time value tables or financial calculator)

Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement. -Having some type of overdraft protection with your bank will end up costing [more | less] than having a check bounce.

A stop payment results in an absolute promise by the bank not to pay the indicated check.

Higher interest rates on certificates of deposit are associated with

A ____ is an interest-bearing checking account.

Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement. -[More than | Fewer than] half the banking institutions in the U.S.are federally insured.

If you invest $1,200 per year at the end of each year for 40 years at an 8% rate of return,you will have accumulated (Use time value table or financial calculator.)

Sammi and Jason have $4,000 to deposit in a money market fund earning 5%.If they add $2,000 to that account annually,how much will they have accumulated in 15 years? (Show all work.)

Terry started saving $50 a month at age 25 in an account earning 6% compounded monthly.At age 40 she would have ____ in this account.(Use time value tables or financial calculator)

Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement. -Low interest rates have [increased | decreased | not impacted ] the supply of credit.

You have a savings plan into which you put $3,000 per year.How much will you accumulate in the account in 25 years if the interest rate is 10%? (Show all work.)

Commercial banks are insured by the

Asset management accounts are offered by most banks and are typically FDIC insured.

S&Ls represent the largest segment of the financial institutions industry.

One can avoid early withdrawal penalties on CDs by purchasing them through brokerage firms.

Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement. -Low interest rates that have persisted since the financial crisis of 2008-09 have been a net benefit to [borrowers | retirees].

Financial institutions expect demand deposits to remain on deposit for a longer period of time than time deposits.

Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement. -[Money market deposit accounts | Asset management accounts] are protected by the Securities Investor Protection Corporation.

When reporting errors or unauthorized transactions,it is best to notify your bank