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. -[Both the depositor and writer | Only the writer] of a "bad" check will likely be charged a fee by their/his banks/bank.

You should invest in long-term CDs when you expect interest rates to fall.

Convenience and improved record keeping are two advantages sited for on-line bill payment.

The annual percentage yield (APY)formula considers compounding when determining an interest rate.

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. -Lower borrowing costs encourage the substitution of [debt for equity | equity for debt] in corporate capital structures.

Vicki Vasquez owns a six-month treasury bill that is four months from maturity.She recently encountered medical problems and needs the money now.She

Debit and ATM card transactions are linked to your checking account.

You put $1,000 into a 12-month certificate of deposit.After seven months,you really need the money.The bank will let you have it before 12 months,but you will pay a penalty.

Money Market Mutual Funds invest in long-term treasury securities and other types of bonds.

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. -[Anyone | Only those with an account at the bank] can purchase cashiers' checks.

If Lois has $2,000 in checking,$50,000 in a money market account,and $75,000 in certificates of deposit (all individual accounts)at her local bank,her accounts would be insured through FDIC for $100,000.

Gordon started saving $25 a month at age 20 in an account earning 4% compounded monthly.At age 40 he 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. -With low interest rates,savers have begun investing in [bonds | stocks] where higher yields can be found.

A certified check is written on the bank's account rather than on a customer's 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. -You are buying a large amount of merchandise through the mail from a dealer several hundred miles from you with whom you have never dealt before.The dealer will probably require that you pay him with a cashiers or [travelers | certified] check.

Although there are no legal minimum balances for a NOW account,many institutions impose their own requirement,often between $500 and $1,000 before they pay any interest.

John Anderson deposited $10,000 in a CD for 3 years at 5%.It should now be worth (Use time value tables or financial calculator)

Low interest rates have increased the supply of credit.

Mary Young has a checking account in her name and a joint savings account with her husband at her bank.The maximum amount of deposit insurance she has is $100,000.

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. -Dottie and Jasper have a joint checking account with rights of survivorship.If Jasper dies,his portion of the account [will | will not] automatically go to Dottie.