Question 1

ATM fees may be different in different geographic areas.

Accepted Answer

A) True 
 B)False  True

Question 2

From a borrower's point of view what annual compounding frequency is best?

Accepted Answer

A) Daily 
B) Monthly 
C) Quaterly 
D) Semi-annually 
E) Annually 
A) Daily 
B) Monthly 
C) Quaterly 
D) Semi-annually 
E) Annually B

Question 3

If you think interest rates will decrease, you should consider investing your money in a longer-term GIC.

Accepted Answer

A) True 
 B)False  True

Question 4

All financial institutions are able to process customer deposit and withdrawal transactions.

Accepted Answer

A) True 
 B)False

Question 5

Savings compounded ____________ would have the highest effective yield

Accepted Answer

A) monthly 
B) annually 
C) semi-annually 
D) daily 
E) weekly 
A) monthly 
B) annually 
C) semi-annually 
D) daily 
E) weekly

Question 6

The funds deposited in a chequing account can be restricted for use by

Accepted Answer

A) a holding period. 
B) outstanding cheques. 
C) interest earned. 
D) service charges. 
E) electronic banking. 
A) a holding period. 
B) outstanding cheques. 
C) interest earned. 
D) service charges. 
E) electronic banking.

Question 7

Store credit cards usually charge a higher interest rate than a bank credit card.

Accepted Answer

A) True 
 B)False

Question 8

Which of the following is not considered an outflow when comparing chequing account costs?

Accepted Answer

A) Monthly service charge 
B) Average number of cheques written per month 
C) Average number of deposits written per month 
D) Fee for dropping below a minimum balance 
E) Average monthly balance and the rate of return 
A) Monthly service charge 
B) Average number of cheques written per month 
C) Average number of deposits written per month 
D) Fee for dropping below a minimum balance 
E) Average monthly balance and the rate of return

Question 9

If the annual rate is 8%, and the interest is compounded annually, what is the effective annual rate?

Accepted Answer

A) 8.00% 
B) 10.25% 
C) 10.38% 
D) 7.85% 
E) 8.24% 
A) 8.00% 
B) 10.25% 
C) 10.38% 
D) 7.85% 
E) 8.24%

Question 10

From an investor's point of view what annual compounding frequency is best?

Accepted Answer

A) Daily 
B) Monthly 
C) Quarterly 
D) Semi-annually 
E) Annually 
A) Daily 
B) Monthly 
C) Quarterly 
D) Semi-annually 
E) Annually

Question 11

Lower returns on savings will usually result in less liquidity.

Accepted Answer

A) True 
 B)False

Question 12

A trust has the purpose of

Accepted Answer

A) solving a person's financial problems. 
B) obtaining low-interest loans. 
C) handling daily money management activities. 
D) managing the assets of a person. 
E) improving a person's budgeting skills. 
A) solving a person's financial problems. 
B) obtaining low-interest loans. 
C) handling daily money management activities. 
D) managing the assets of a person. 
E) improving a person's budgeting skills.

Question 13

Savers should always attempt to obtain an interest rate that is less than the inflation rate.

Accepted Answer

A) True 
 B)False

Question 14

A personal cheque with guaranteed payment is called a

Accepted Answer

A) traveler's cheque. 
B) bank draft. 
C) certified cheque. 
D) money order. 
E) cashier's cheque. 
A) traveler's cheque. 
B) bank draft. 
C) certified cheque. 
D) money order. 
E) cashier's cheque.

Question 15

What is a drawback of a money market account?

Accepted Answer

A) Low rate of return 
B) Minimum deposit 
C) Service charges 
D) High minimum balance required 
E) Not guaranteed 
A) Low rate of return 
B) Minimum deposit 
C) Service charges 
D) High minimum balance required 
E) Not guaranteed

Question 16

ATM fees are about the same in different geographic areas.

Accepted Answer

A) True 
 B)False

Question 17

The major service offered by investment companies is

Accepted Answer

A) interest-bearing checking accounts. 
B) variable-rate loans. 
C) credit card accounts. 
D) savings bonds. 
E) mutual funds. 
A) interest-bearing checking accounts. 
B) variable-rate loans. 
C) credit card accounts. 
D) savings bonds. 
E) mutual funds.

Question 18

If the annual rate is 10%, and the interest is compounded quarterly, what is the effective annual rate?

Accepted Answer

A) 10.00% 
B) 10.25% 
C) 10.38% 
D) 12.00% 
E) 12.68% 
A) 10.00% 
B) 10.25% 
C) 10.38% 
D) 12.00% 
E) 12.68%

Question 19

Which best describes the prime rate of interest?

Accepted Answer

A) The lending rate banks charge their most creditworthy clients 
B) The yield on 91-day treasury bills 
C) The yield on 30-year government bonds 
D) The lending rate the Bank of Canada charges financial institutions. 
E) The base rate for all mortgages 
A) The lending rate banks charge their most creditworthy clients 
B) The yield on 91-day treasury bills 
C) The yield on 30-year government bonds 
D) The lending rate the Bank of Canada charges financial institutions. 
E) The base rate for all mortgages

Question 20

If the annual rate is 3% and inflation is 2%, then the approximate real rate of return is:

Accepted Answer

A) 5.00% 
B) 3.00% 
C) 1.00% 
D) - 1.0% 
E) 0% 
A) 5.00% 
B) 3.00% 
C) 1.00% 
D) - 1.0% 
E) 0%

ATM fees may be different in different geographic areas.

From a borrower's point of view what annual compounding frequency is best?

If you think interest rates will decrease, you should consider investing your money in a longer-term GIC.

All financial institutions are able to process customer deposit and withdrawal transactions.

Savings compounded ____________ would have the highest effective yield

The funds deposited in a chequing account can be restricted for use by

Store credit cards usually charge a higher interest rate than a bank credit card.

Which of the following is not considered an outflow when comparing chequing account costs?

If the annual rate is 8%, and the interest is compounded annually, what is the effective annual rate?

From an investor's point of view what annual compounding frequency is best?

Lower returns on savings will usually result in less liquidity.

A trust has the purpose of

Savers should always attempt to obtain an interest rate that is less than the inflation rate.

A personal cheque with guaranteed payment is called a

What is a drawback of a money market account?

ATM fees are about the same in different geographic areas.

The major service offered by investment companies is

If the annual rate is 10%, and the interest is compounded quarterly, what is the effective annual rate?

Which best describes the prime rate of interest?

If the annual rate is 3% and inflation is 2%, then the approximate real rate of return is:

Personal Financial Planning: An Introduction

Money Management Strategy: Financial Statements and Budgeting

Planning Your Tax Strategy

Introduction to Consumer Credit

Choosing a Source of Credit: The Costs of Credit Alternatives

The Finances of Housing

Home and Automobile Insurance

Life, Health, and Disability Insurance

Fundamentals of Investing

Investing in Stocks

Investing in Bonds

Investing in Mutual Funds

Retirement Planning

Estate Planning

Filters

Exam 4: Banking Services of Financial Institutions

ATM fees may be different in different geographic areas.

From a borrower's point of view what annual compounding frequency is best?

If you think interest rates will decrease, you should consider investing your money in a longer-term GIC.

All financial institutions are able to process customer deposit and withdrawal transactions.

Savings compounded ____________ would have the highest effective yield

The funds deposited in a chequing account can be restricted for use by

Store credit cards usually charge a higher interest rate than a bank credit card.

Which of the following is not considered an outflow when comparing chequing account costs?

If the annual rate is 8%, and the interest is compounded annually, what is the effective annual rate?

From an investor's point of view what annual compounding frequency is best?

Lower returns on savings will usually result in less liquidity.

A trust has the purpose of

Savers should always attempt to obtain an interest rate that is less than the inflation rate.

A personal cheque with guaranteed payment is called a

What is a drawback of a money market account?

ATM fees are about the same in different geographic areas.

The major service offered by investment companies is

If the annual rate is 10%, and the interest is compounded quarterly, what is the effective annual rate?

Which best describes the prime rate of interest?

If the annual rate is 3% and inflation is 2%, then the approximate real rate of return is:

Personal Financial Planning: An Introduction

Money Management Strategy: Financial Statements and Budgeting

Planning Your Tax Strategy

Introduction to Consumer Credit

Choosing a Source of Credit: The Costs of Credit Alternatives

The Finances of Housing

Home and Automobile Insurance

Life, Health, and Disability Insurance

Fundamentals of Investing

Investing in Stocks

Investing in Bonds

Investing in Mutual Funds

Retirement Planning

Estate Planning

Filters