Question 1

Historically,the primary purpose of savings and loan associations was to

Accepted Answer

A)  provide passbook accounts paying interest above that of commercial banks. 
B)  compete directly with commercial banks. 
C)  provide NOW accounts. 
D)  provide demand deposits. 
E)  channel savings into mortgages. 
A)  provide passbook accounts paying interest above that of commercial banks. 
B)  compete directly with commercial banks. 
C)  provide NOW accounts. 
D)  provide demand deposits. 
E)  channel savings into mortgages.

Question 2

Treasury bills are sold at their face value.

Accepted Answer

A) True 
 B)False

Question 3

Mandy has $2,000 she would like to start a savings program.She will add to it regularly by investing $50 per month in a liquid account.Which of the following types of accounts would be most appropriate in this situation?

Accepted Answer

A)  Series EE US savings bonds 
B)  Money market deposit account 
C)  Certificates of deposit 
D)  US Treasury bills 
E)  NOW account 
A)  Series EE US savings bonds 
B)  Money market deposit account 
C)  Certificates of deposit 
D)  US Treasury bills 
E)  NOW account

Question 4

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.
-Banks must notify customers [30 | 60] days before lowering rates on deposit accounts or certificates of deposit.

Accepted Answer

The answer of Choose the word or phrase in [...

Question 5

The rate of return on liquid assets is relatively high compared to other types of investments.

Accepted Answer

A) True 
 B)False

Question 6

Whenever you write a check or make a deposit,an entry should be made on your

Accepted Answer

A)  deposit slip. 
B)  checkbook ledger. 
C)  check. 
D)  ATM account. 
E)  personal check. 
A)  deposit slip. 
B)  checkbook ledger. 
C)  check. 
D)  ATM account. 
E)  personal check.

Question 7

A lump sum deposit of $8,000 left in the bank for 12 years at 9% compounded annually will result in an ending balance of (select the closest answer)

Accepted Answer

A)  $11,600. 
B)  $16,640. 
C)  $22,480. 
D)  $52,938. 
E)  $96,000. 
A)  $11,600. 
B)  $16,640. 
C)  $22,480. 
D)  $52,938. 
E)  $96,000.

Question 8

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.
-Your bank pays 3% interest,compounded quarterly.At the end of one year,your $5,000 will have earned [$150 | over $150] interest.

Accepted Answer

The answer of Choose the word or phrase in [...

Question 9

The rate of return on a Series EE savings bond changes semiannually.

Accepted Answer

A) True 
 B)False

Question 10

If your bank states that it compounds monthly,the effective interest rate (APY)will be greater than the nominal interest rate.

Accepted Answer

A) True 
 B)False

Question 11

A bank could advertise as "free" a checking account that requires a minimum balance of $3,000 to avoid monthly service charges.

Accepted Answer

A) True 
 B)False

Question 12

Asset management accounts combine many cash management services into one account.

Accepted Answer

A) True 
 B)False

Question 13

A money market mutual fund is one way to participate indirectly in the purchase of money market securities.

Accepted Answer

A) True 
 B)False

Question 14

Which of the following would be best suited to using an Internet bank?

Accepted Answer

A)  Nancy Johnson, a young businesswoman who uses bank financing regularly for her business 
B)  Milan Sosa, an older gentleman who enjoys visiting his local banker 
C)  Molly Peterson, a woman who uses multiple bank services including a safe-deposit box 
D)  Fred Longoria, a man who uses checking and savings but never goes to his bank 
E)  All of the above would be good candidates because the cost of Internet banking is lower than other types of banks. 
A)  Nancy Johnson, a young businesswoman who uses bank financing regularly for her business 
B)  Milan Sosa, an older gentleman who enjoys visiting his local banker 
C)  Molly Peterson, a woman who uses multiple bank services including a safe-deposit box 
D)  Fred Longoria, a man who uses checking and savings but never goes to his bank 
E)  All of the above would be good candidates because the cost of Internet banking is lower than other types of banks.

Question 15

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.
-During the past few years,the number of financial institution failures per year has [risen | dropped].

Accepted Answer

The answer of Choose the word or phrase in [...

Question 16

Maggie wants to open a checking account that will be the least expensive given her normal financial transactions.She typically writes 15 checks a month and uses an ATM 35 times a month.Her minimum checking balances falls to about $350 in an average month.Which of the following accounts would be least expensive for Maggie? (Show all your work.)
Account A:
 - No monthly fee is charged if a minimum balance of at least $ \$ 300 $ is maintained.
- A $ \$ 5.00 $ fee is charged in any month the minimum balance falls below $ \$ 300 $.
- An ATM fee of $ \$ 0.10 $ per transaction is charged on all transactions. 
Account B:
 - No monthly fee is charged if a minimum balance of at least $ \$ 500 $ is maintained.
- A $ \$ 3.00 $ fee plus $ \$ 0.10 / $ check is charged in any month the minimum balance falls below $ \$ 500 $.
- There is no ATM fee on transactions.

Accepted Answer

Account A
Cost of Account A =

Question 17

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.
-Credit unions are more likely to be paying [much | slightly] higher interest rates on their accounts than a commercial bank.

Accepted Answer

The answer of Choose the word or phrase in [...

Question 18

Money market mutual funds are insured up to $250,000 by the FDIC if purchased at an insured bank.

Accepted Answer

A) True 
 B)False

Question 19

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.
-[All | Some] banks must return canceled checks with the monthly statement although most are abandoning this practice.

Accepted Answer

The answer of Choose the word or phrase in [...

Question 20

The minimum denomination for Treasury bills is now $1,000.

Accepted Answer

A) True 
 B)False

Historically,the primary purpose of savings and loan associations was to

Treasury bills are sold at their face value.

Mandy has $2,000 she would like to start a savings program.She will add to it regularly by investing $50 per month in a liquid account.Which of the following types of accounts would be most appropriate in this situation?

The rate of return on liquid assets is relatively high compared to other types of investments.

Whenever you write a check or make a deposit,an entry should be made on your

A lump sum deposit of $8,000 left in the bank for 12 years at 9% compounded annually will result in an ending balance of (select the closest answer)

The rate of return on a Series EE savings bond changes semiannually.

If your bank states that it compounds monthly,the effective interest rate (APY)will be greater than the nominal interest rate.

A bank could advertise as "free" a checking account that requires a minimum balance of $3,000 to avoid monthly service charges.

Asset management accounts combine many cash management services into one account.

A money market mutual fund is one way to participate indirectly in the purchase of money market securities.

Which of the following would be best suited to using an Internet bank?

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. -During the past few years,the number of financial institution failures per year has [risen | dropped].

Money market mutual funds are insured up to $250,000 by the FDIC if purchased at an insured bank.

The minimum denomination for Treasury bills is now $1,000.

Understanding the Financial Planning Process

Using Financial Statements and Budgets

Preparing Your Taxes

Making Automobile and Housing Decisions

Using Credit

Using Consumer Loans

Insuring Your Life

Insuring Your Health

Protecting Your Property

Investment Planning

Investing in Stocks and Bonds

Investing in Mutual Funds

Planning for Retirement

Preserving Your Estate

Filters

Exam 4: Managing Your Cash and Savings

Historically,the primary purpose of savings and loan associations was to

Treasury bills are sold at their face value.

Mandy has $2,000 she would like to start a savings program.She will add to it regularly by investing $50 per month in a liquid account.Which of the following types of accounts would be most appropriate in this situation?

The rate of return on liquid assets is relatively high compared to other types of investments.

Whenever you write a check or make a deposit,an entry should be made on your

A lump sum deposit of $8,000 left in the bank for 12 years at 9% compounded annually will result in an ending balance of (select the closest answer)

The rate of return on a Series EE savings bond changes semiannually.

If your bank states that it compounds monthly,the effective interest rate (APY)will be greater than the nominal interest rate.

A bank could advertise as "free" a checking account that requires a minimum balance of $3,000 to avoid monthly service charges.

Asset management accounts combine many cash management services into one account.

A money market mutual fund is one way to participate indirectly in the purchase of money market securities.

Which of the following would be best suited to using an Internet bank?

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. -During the past few years,the number of financial institution failures per year has [risen | dropped].

Money market mutual funds are insured up to $250,000 by the FDIC if purchased at an insured bank.

The minimum denomination for Treasury bills is now $1,000.

Understanding the Financial Planning Process

Using Financial Statements and Budgets

Preparing Your Taxes

Making Automobile and Housing Decisions

Using Credit

Using Consumer Loans

Insuring Your Life

Insuring Your Health

Protecting Your Property

Investment Planning

Investing in Stocks and Bonds

Investing in Mutual Funds

Planning for Retirement

Preserving Your Estate

Filters