Question 1

Joan Zemke expects interest rates to decline over the next few months.To maximize her earnings she should use a(n):

Accepted Answer

A) regular savings account. 
B) interest-bearing checking account. 
C) five-year certificate of deposit. 
D) six-month certificate of deposit. 
E) money market fund. 
A) regular savings account. 
B) interest-bearing checking account. 
C) five-year certificate of deposit. 
D) six-month certificate of deposit. 
E) money market fund. C

Question 2

A saver will usually earn the highest rate with which one of the following types of savings plans?

Accepted Answer

A) certificate of deposit 
B) debit account 
C) passbook account 
D) share account 
E) NOW account 
A) certificate of deposit 
B) debit account 
C) passbook account 
D) share account 
E) NOW account A

Question 3

The rate of return on a savings account is also referred to as:

Accepted Answer

A) liquidity. 
B) compounding. 
C) yield. 
D) opportunity cost. 
E) asset turnover. 
A) liquidity. 
B) compounding. 
C) yield. 
D) opportunity cost. 
E) asset turnover. C

Question 4

The purpose of a "special" endorsement is to:

Accepted Answer

A) cash a check. 
B) deposit a check. 
C) transfer a check to another person. 
D) withdraw cash from your account. 
E) reduce the charge for service fees. 
A) cash a check. 
B) deposit a check. 
C) transfer a check to another person. 
D) withdraw cash from your account. 
E) reduce the charge for service fees.

Question 5

Savings and loan associations offer mortgages.

Accepted Answer

A) True 
 B)False

Question 6

In recent years,membership in credit unions has:

Accepted Answer

A) become more difficult due to higher taxes. 
B) continued to increase. 
C) been limited to government employees. 
D) declined due to poor credit union management. 
E) stayed at about the same level. 
A) become more difficult due to higher taxes. 
B) continued to increase. 
C) been limited to government employees. 
D) declined due to poor credit union management. 
E) stayed at about the same level.

Question 7

A savings account earns 4 percent.If the saver is in a 28 percent tax bracket,the after-tax savings rate of return would be ____ percent.

Accepted Answer

A) 28.00 
B) 16.72 
C) 4.00 
D) 2.88 
E) 1.12 
A) 28.00 
B) 16.72 
C) 4.00 
D) 2.88 
E) 1.12

Question 8

The business hours and location of a financial institution refer to the ____________ factor of selecting a financial institution.

Accepted Answer

A) safety 
B) cost 
C) compounding 
D) liquidity 
E) convenience 
A) safety 
B) cost 
C) compounding 
D) liquidity 
E) convenience

Question 9

Higher returns on savings will usually result in less liquidity.

Accepted Answer

A) True 
 B)False

Question 10

The Federal Deposit Insurance Corporation provides deposit insurance for:

Accepted Answer

A) credit unions and mutual savings banks. 
B) commercial banks and savings and loan associations. 
C) investment companies and finance companies. 
D) insurance companies and credit unions. 
E) commercial banks and credit unions. 
A) credit unions and mutual savings banks. 
B) commercial banks and savings and loan associations. 
C) investment companies and finance companies. 
D) insurance companies and credit unions. 
E) commercial banks and credit unions.

Question 11

You are planning to purchase a house in five years and intend to save a fixed amount of money each month for a down payment.How will you invest your savings and what are important considerations in selecting an investment vehicle?

Accepted Answer

The answer of You are planning to purchase a house...

Question 12

A limit on the amount you must keep on deposit in order to earn interest or avoid a service charge is an example of a (an):

Accepted Answer

A) holding period. 
B) restriction. 
C) overdraft fee. 
D) share draft. 
E) certified deposit feE. 
A) holding period. 
B) restriction. 
C) overdraft fee. 
D) share draft. 
E) certified deposit feE.

Question 13

Which of the following is a drawback of a money market fund from an investment company?

Accepted Answer

A) penalty if money is withdrawn early 
B) lower rate of interest if redeemed within the first five years 
C) minimum required holding period 
D) lack of FDIC insurance 
E) taxed at a higher rate than other investments 
A) penalty if money is withdrawn early 
B) lower rate of interest if redeemed within the first five years 
C) minimum required holding period 
D) lack of FDIC insurance 
E) taxed at a higher rate than other investments

Question 14

Using a "debit" card is basically the same as writing a check.

Accepted Answer

A) True 
 B)False

Question 15

Traditionally,the greatest variety of financial services is offered by:

Accepted Answer

A) credit unions. 
B) investment companies. 
C) mutual savings banks. 
D) savings and loan associations. 
E) commercial banks. 
A) credit unions. 
B) investment companies. 
C) mutual savings banks. 
D) savings and loan associations. 
E) commercial banks.

Question 16

What type of account would be considered the most liquid?

Accepted Answer

A) certificate of deposit 
B) checking account 
C) money market account 
D) brokerage account 
E) share of stock 
A) certificate of deposit 
B) checking account 
C) money market account 
D) brokerage account 
E) share of stock

Question 17

Which of the following institutions makes loans based on the value of tangibles possessions,such as jewelry and collectibles?

Accepted Answer

A) life insurance company 
B) finance company 
C) mortgage company 
D) pawnshop 
E) investment company 
A) life insurance company 
B) finance company 
C) mortgage company 
D) pawnshop 
E) investment company

Question 18

Time deposits consist of:

Accepted Answer

A) checking accounts. 
B) loans and charge accounts. 
C) savings accounts. 
D) government securities. 
E) profits earned by a financial institution. 
A) checking accounts. 
B) loans and charge accounts. 
C) savings accounts. 
D) government securities. 
E) profits earned by a financial institution.

Question 19

The purpose of a debit card is to:

Accepted Answer

A) obtain a discount on consumer purchases. 
B) make credit card purchases. 
C) quickly obtain a cash loan. 
D) make investments with an investment company. 
E) transfer money electronically. 
A) obtain a discount on consumer purchases. 
B) make credit card purchases. 
C) quickly obtain a cash loan. 
D) make investments with an investment company. 
E) transfer money electronically.

Question 20

When preparing a bank reconciliation,outstanding checks should be:

Accepted Answer

A) added to the bank statement balance. 
B) subtracted from the bank statement balance. 
C) added to the checkbook balance. 
D) subtracted from the checkbook balance. 
E) ignored until they have cleared. 
A) added to the bank statement balance. 
B) subtracted from the bank statement balance. 
C) added to the checkbook balance. 
D) subtracted from the checkbook balance. 
E) ignored until they have cleared.

Joan Zemke expects interest rates to decline over the next few months.To maximize her earnings she should use a(n):

A saver will usually earn the highest rate with which one of the following types of savings plans?

The rate of return on a savings account is also referred to as:

The purpose of a "special" endorsement is to:

Savings and loan associations offer mortgages.

In recent years,membership in credit unions has:

A savings account earns 4 percent.If the saver is in a 28 percent tax bracket,the after-tax savings rate of return would be ____ percent.

The business hours and location of a financial institution refer to the ____________ factor of selecting a financial institution.

Higher returns on savings will usually result in less liquidity.

The Federal Deposit Insurance Corporation provides deposit insurance for:

You are planning to purchase a house in five years and intend to save a fixed amount of money each month for a down payment.How will you invest your savings and what are important considerations in selecting an investment vehicle?

A limit on the amount you must keep on deposit in order to earn interest or avoid a service charge is an example of a (an):

Which of the following is a drawback of a money market fund from an investment company?

Using a "debit" card is basically the same as writing a check.

Traditionally,the greatest variety of financial services is offered by:

What type of account would be considered the most liquid?

Which of the following institutions makes loans based on the value of tangibles possessions,such as jewelry and collectibles?

Time deposits consist of:

The purpose of a debit card is to:

When preparing a bank reconciliation,outstanding checks should be:

Personal Finance Basics and the Time Value of Money

Financial Aspects of Career Planning

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

Consumer Purchasing Strategies and Legal Protection

The Housing Decision: Factors and Finances

Property and Motor Vehicle Insurance

Health, Disability, and Long-Term Care Insurance

Life Insurance

Investing Fundamentals

Investing in Stocks

Investing in Bonds

Investing in Mutual Funds

Investing in Real Estate and Other Investment Alternatives

Starting Early: Retirement Planning

Estate Planning

Filters

Exam 5: Financial Services: Savings Plans and Payment Accounts

Joan Zemke expects interest rates to decline over the next few months.To maximize her earnings she should use a(n):

A saver will usually earn the highest rate with which one of the following types of savings plans?

The rate of return on a savings account is also referred to as:

The purpose of a "special" endorsement is to:

Savings and loan associations offer mortgages.

In recent years,membership in credit unions has:

A savings account earns 4 percent.If the saver is in a 28 percent tax bracket,the after-tax savings rate of return would be ____ percent.

The business hours and location of a financial institution refer to the ____________ factor of selecting a financial institution.

Higher returns on savings will usually result in less liquidity.

The Federal Deposit Insurance Corporation provides deposit insurance for:

You are planning to purchase a house in five years and intend to save a fixed amount of money each month for a down payment.How will you invest your savings and what are important considerations in selecting an investment vehicle?

A limit on the amount you must keep on deposit in order to earn interest or avoid a service charge is an example of a (an):

Which of the following is a drawback of a money market fund from an investment company?

Using a "debit" card is basically the same as writing a check.

Traditionally,the greatest variety of financial services is offered by:

What type of account would be considered the most liquid?

Which of the following institutions makes loans based on the value of tangibles possessions,such as jewelry and collectibles?

Time deposits consist of:

The purpose of a debit card is to:

When preparing a bank reconciliation,outstanding checks should be:

Personal Finance Basics and the Time Value of Money

Financial Aspects of Career Planning

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

Consumer Purchasing Strategies and Legal Protection

The Housing Decision: Factors and Finances

Property and Motor Vehicle Insurance

Health, Disability, and Long-Term Care Insurance

Life Insurance

Investing Fundamentals

Investing in Stocks

Investing in Bonds

Investing in Mutual Funds

Investing in Real Estate and Other Investment Alternatives

Starting Early: Retirement Planning

Estate Planning

Filters