Question 1

When Ted needs more cash than he has available, his choices include liquidating savings and borrowing.

Accepted Answer

A) True 
 B)False

Question 2

Marcus bought a certificate of deposit whose interest rate is based on the stock market. Sometimes, his earnings are higher than other similar cds, and at other times, his earnings are lower. He purchased a

Accepted Answer

A)  Bump-up CD. 
B)  Callable CD. 
C)  Portfolio CD. 
D)  Promotional CD. 
E)  Indexed CD. 
A)  Bump-up CD. 
B)  Callable CD. 
C)  Portfolio CD. 
D)  Promotional CD. 
E)  Indexed CD.

Question 3

Preston never opened his bank statements, so he was surprised to see that he had incurred a service charge, because his balance went below a required minimum balance. In addition, he did not earn interest for this month. What kind of account does Preston have?

Accepted Answer

A)  A regular savings account. 
B)  An activity account. 
C)  An interest-earning checking account. 
D)  Passbook account. 
E)  All of the above are correct. 
A)  A regular savings account. 
B)  An activity account. 
C)  An interest-earning checking account. 
D)  Passbook account. 
E)  All of the above are correct.

Question 4

Which of the following is organized as a corporation with investors (stockholders) contributing the needed capital to operate?

Accepted Answer

A)  A commercial bank 
B)  A check-cashing outlet 
C)  A pawnshop 
D)  A payday loan facility 
E)  A rent-to-own center 
A)  A commercial bank 
B)  A check-cashing outlet 
C)  A pawnshop 
D)  A payday loan facility 
E)  A rent-to-own center

Question 5

A certificate of deposit that has earnings based on the stock market is called a (n)

Accepted Answer

A)  Bump-up CD. 
B)  Callable CD. 
C)  Portfolio CD. 
D)  Promotional CD. 
E)  Indexed CD. 
A)  Bump-up CD. 
B)  Callable CD. 
C)  Portfolio CD. 
D)  Promotional CD. 
E)  Indexed CD.

Question 6

The text discusses several types of bonds. Which bond pays interest for 30 years that is exempt from state and local taxes?

Accepted Answer

A)  Series E 
B)  Series EE 
C)  Series HH 
D)  Series I 
E)  Series Q 
A)  Series E 
B)  Series EE 
C)  Series HH 
D)  Series I 
E)  Series Q

Question 7

Earning interest on previously earned interest is called

Accepted Answer

A)  Compounding. 
B)  Liquidity. 
C)  Minimum deposit. 
D)  Rate of return. 
E)  Safety. 
A)  Compounding. 
B)  Liquidity. 
C)  Minimum deposit. 
D)  Rate of return. 
E)  Safety.

Question 8

When Jack picked up a personal computer from the _____, he was really leasing it.

Accepted Answer

A)  commercial bank 
B)  check-cashing outlet 
C)  pawnshop 
D)  payday loan company 
E)  rent-to-own center 
A)  commercial bank 
B)  check-cashing outlet 
C)  pawnshop 
D)  payday loan company 
E)  rent-to-own center

Question 9

Which of the following will likely provide the most expensive loans?

Accepted Answer

A)  A credit card company 
B)  An investment company 
C)  A life insurance company 
D)  A finance company 
E)  A payday loan company 
A)  A credit card company 
B)  An investment company 
C)  A life insurance company 
D)  A finance company 
E)  A payday loan company

Question 10

Making transactions using a credit card will immediately reduce your bank balance.

Accepted Answer

A) True 
 B)False

Question 11

Due to Check 21, the processing time for deposited checks has increased.

Accepted Answer

A) True 
 B)False

Question 12

The text discusses several types of bonds. Which bond, which is no longer sold, electronically deposits interest into your bank account every six months?

Accepted Answer

A)  Series E 
B)  Series EE 
C)  Series HH 
D)  Series I 
E)  Series Q 
A)  Series E 
B)  Series EE 
C)  Series HH 
D)  Series I 
E)  Series Q

Question 13

A loan from a pawnshop will be more expensive than one from a bank.

Accepted Answer

A) True 
 B)False

Question 14

Wanda bought a certificate of deposit and automatically received a free bike. She purchased a

Accepted Answer

A)  Bump-up CD. 
B)  Callable CD. 
C)  Portfolio CD. 
D)  Promotional CD. 
E)  Indexed CD. 
A)  Bump-up CD. 
B)  Callable CD. 
C)  Portfolio CD. 
D)  Promotional CD. 
E)  Indexed CD.

Question 15

Which of the following is correct?

Accepted Answer

A)  Canceled checks are typically returned to customers. 
B)  Overdraft protection is a loan banks make to their checking account customers who have large balances. 
C)  Bank customers typically are provided with online access to view and print checks that have been paid. 
D)  Overdraft protection is usually more costly than fees charged for checks with insufficient funds. 
E)  Checking accounts packaged with several services (safe deposit box, travelers checks, low-rate loans, etc.) for a single fee usually are a good value. 
A)  Canceled checks are typically returned to customers. 
B)  Overdraft protection is a loan banks make to their checking account customers who have large balances. 
C)  Bank customers typically are provided with online access to view and print checks that have been paid. 
D)  Overdraft protection is usually more costly than fees charged for checks with insufficient funds. 
E)  Checking accounts packaged with several services (safe deposit box, travelers checks, low-rate loans, etc.) for a single fee usually are a good value.

Question 16

A bump-up CD allows an investor to increase the amount invested at various intervals.

Accepted Answer

A) True 
 B)False

Question 17

Kylie went to a post office to obtain a

Accepted Answer

A)  Certified check. 
B)  Cashier's check. 
C)  Money order. 
D)  Personal check. 
E)  Merchant's check. 
A)  Certified check. 
B)  Cashier's check. 
C)  Money order. 
D)  Personal check. 
E)  Merchant's check.

Question 18

Patrick is interested in opening a different account that will allow him to write a few checks each month for a fee per check, but he is unable to maintain a minimum balance. He should open a(n)

Accepted Answer

A)  Regular savings account. 
B)  Activity account. 
C)  Interest-earning checking account. 
D)  Share draft account. 
E)  Passbook account. 
A)  Regular savings account. 
B)  Activity account. 
C)  Interest-earning checking account. 
D)  Share draft account. 
E)  Passbook account.

Question 19

Franklin is planning for a purchase of a vehicle in two years. Since he wants to be certain that his funds are safe (insured), which of the following should he use?

Accepted Answer

A)  A credit card. 
B)  A trust. 
C)  A loan. 
D)  A savings account. 
E)  A home mortgage. 
A)  A credit card. 
B)  A trust. 
C)  A loan. 
D)  A savings account. 
E)  A home mortgage.

Question 20

Money market funds are not covered by federal deposit insurance.

Accepted Answer

A) True 
 B)False

When Ted needs more cash than he has available, his choices include liquidating savings and borrowing.

Marcus bought a certificate of deposit whose interest rate is based on the stock market. Sometimes, his earnings are higher than other similar cds, and at other times, his earnings are lower. He purchased a

Preston never opened his bank statements, so he was surprised to see that he had incurred a service charge, because his balance went below a required minimum balance. In addition, he did not earn interest for this month. What kind of account does Preston have?

Which of the following is organized as a corporation with investors (stockholders) contributing the needed capital to operate?

A certificate of deposit that has earnings based on the stock market is called a (n)

The text discusses several types of bonds. Which bond pays interest for 30 years that is exempt from state and local taxes?

Earning interest on previously earned interest is called

When Jack picked up a personal computer from the _____, he was really leasing it.

Which of the following will likely provide the most expensive loans?

Making transactions using a credit card will immediately reduce your bank balance.

Due to Check 21, the processing time for deposited checks has increased.

The text discusses several types of bonds. Which bond, which is no longer sold, electronically deposits interest into your bank account every six months?

A loan from a pawnshop will be more expensive than one from a bank.

Wanda bought a certificate of deposit and automatically received a free bike. She purchased a

Which of the following is correct?

A bump-up CD allows an investor to increase the amount invested at various intervals.

Kylie went to a post office to obtain a

Patrick is interested in opening a different account that will allow him to write a few checks each month for a fee per check, but he is unable to maintain a minimum balance. He should open a(n)

Franklin is planning for a purchase of a vehicle in two years. Since he wants to be certain that his funds are safe (insured), which of the following should he use?

Money market funds are not covered by federal deposit insurance.

Personal Financial Planning in Action

Money Management Skills

Taxes in Your Financial Plan

Consumer Credit: Advantages, Disadvantages, Sources, and Costs

Consumer Purchasing Strategies and Wise Buying of Motor Vehicles

Selecting and Financing Housing

Home and Automobile Insurance

Health and Disability Insurance

Financial Planning With Life Insurance

Investing Fundamentals and Bonds

Investing in Stocks

Investing in Mutual Funds

Starting Early: Retirement and Estate Planning

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Exam 4: Financial Services: Saving Plans and Payment Accounts

When Ted needs more cash than he has available, his choices include liquidating savings and borrowing.

Marcus bought a certificate of deposit whose interest rate is based on the stock market. Sometimes, his earnings are higher than other similar cds, and at other times, his earnings are lower. He purchased a

Preston never opened his bank statements, so he was surprised to see that he had incurred a service charge, because his balance went below a required minimum balance. In addition, he did not earn interest for this month. What kind of account does Preston have?

Which of the following is organized as a corporation with investors (stockholders) contributing the needed capital to operate?

A certificate of deposit that has earnings based on the stock market is called a (n)

The text discusses several types of bonds. Which bond pays interest for 30 years that is exempt from state and local taxes?

Earning interest on previously earned interest is called

When Jack picked up a personal computer from the _____, he was really leasing it.

Which of the following will likely provide the most expensive loans?

Making transactions using a credit card will immediately reduce your bank balance.

Due to Check 21, the processing time for deposited checks has increased.

The text discusses several types of bonds. Which bond, which is no longer sold, electronically deposits interest into your bank account every six months?

A loan from a pawnshop will be more expensive than one from a bank.

Wanda bought a certificate of deposit and automatically received a free bike. She purchased a

Which of the following is correct?

A bump-up CD allows an investor to increase the amount invested at various intervals.

Kylie went to a post office to obtain a

Patrick is interested in opening a different account that will allow him to write a few checks each month for a fee per check, but he is unable to maintain a minimum balance. He should open a(n)

Franklin is planning for a purchase of a vehicle in two years. Since he wants to be certain that his funds are safe (insured), which of the following should he use?

Money market funds are not covered by federal deposit insurance.

Personal Financial Planning in Action

Money Management Skills

Taxes in Your Financial Plan

Consumer Credit: Advantages, Disadvantages, Sources, and Costs

Consumer Purchasing Strategies and Wise Buying of Motor Vehicles

Selecting and Financing Housing

Home and Automobile Insurance

Health and Disability Insurance

Financial Planning With Life Insurance

Investing Fundamentals and Bonds

Investing in Stocks

Investing in Mutual Funds

Starting Early: Retirement and Estate Planning

Filters