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. -[More than | Fewer than] half the banking institutions in the U.S.are federally insured.

Connie Shockey wants to put funds in an account that does not offer checking privileges because she has a tendency to overspend.Which of the following would fit her criteria?

Most savers do not prefer to keep their emergency funds in a regular savings.

The key to a successful savings program is to save regularly.

Electronic funds transfer system (EFTS)allows you to make payments that occur on a regular basis.

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. -Natalie is faced with two savings choices: making a single deposit of $5,000 or making five annual deposits of $1,000.The interest rate on both is 4%,compounded monthly.The [lump sum deposit | annual deposits] plan will result in a higher balance at the end of five years.

The financial services industry continues to evolve because of advanced technology.

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 a checking account at the bank] can purchase cashier's checks.

Certificates of deposit can be purchased only at banks,savings and loan associations,and credit unions.

Savings and loan associations usually offer non-interest bearing checking accounts.

Joint checking accounts typically imply the right of survivorship if one party will die.

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.

The main business of a savings and loan association (S&L)is to provide home mortgage and home improvement loans.

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

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

Joe Gustafson is a very busy person who likes to handle all his financial services needs with one account if possible.Which of the following types of accounts would best serve this need?

The stated interest rate on your account is 5%,interest compounded monthly.If you deposit $50 each month,how much will you have in your account in 5 years? (Use time value tables or financial calculator.Select the closest answer.)

You can stop payment when you purchase an item with your debit card.

If you invest $1,200 per year at the end of each year for 40 years at an 8% rate of return,you will have accumulated: (Use time value table or financial calculator.Select the closest answer.)

Savings and loan associations (S&Ls)channel the savings of depositors primarily into automotive loans.