Question 1

Checks mailed to the bank for deposit should always be endorsed with a restrictive endorsement.

Accepted Answer

A) True 
 B)False

Question 2

If you have an automatic overdraft loan agreement with your bank,money will be borrowed from your MasterCard or Visa as a cash advance when you write a bad check.

Accepted Answer

A) True 
 B)False

Question 3

The goal of monetary asset management is to maximize interest earnings and minimizing fees while keeping funds safe and readily available.

Accepted Answer

A) True 
 B)False

Question 4

Certificates of deposit (CDs) tend to pay higher rates of interest than money market accounts because

Accepted Answer

A) CDs are not government insured and therefore are riskier investments than money market accounts. 
B) the required minimum investment for CDs is higher than for money market accounts. 
C) there are higher annual fees charged for CDs than for money market accounts. 
D) the investor agrees to leave his or her money in the CD for a specified period of time while he or she has free access to the funds in a money market account. 
A) CDs are not government insured and therefore are riskier investments than money market accounts. 
B) the required minimum investment for CDs is higher than for money market accounts. 
C) there are higher annual fees charged for CDs than for money market accounts. 
D) the investor agrees to leave his or her money in the CD for a specified period of time while he or she has free access to the funds in a money market account.

Question 5

Liquidity is the speed and ease with which an asset can be converted to cash.

Accepted Answer

A) True 
 B)False

Question 6

The only reason to have a checking account is so that one has an account for writing checks.

Accepted Answer

A) True 
 B)False

Question 7

If Gus believes interest rates are going to fall in the near future and remain low for several years,Gus should now

Accepted Answer

A) invest in a variable-rate certificate of deposit. 
B) invest in a long-term, fixed-rate certificate of deposit. 
C) invest in a short-term, fixed-rate certificate of deposit. 
D) bury his money in fruit jars in the back yard. 
A) invest in a variable-rate certificate of deposit. 
B) invest in a long-term, fixed-rate certificate of deposit. 
C) invest in a short-term, fixed-rate certificate of deposit. 
D) bury his money in fruit jars in the back yard.

Question 8

When an account pays one rate of interest on a minimum amount on deposit and a higher rate of interest on additional deposits,this is called ____ interest.

Accepted Answer

A) compound 
B) variable 
C) tiered 
D) none of these 
A) compound 
B) variable 
C) tiered 
D) none of these

Question 9

Demand deposits are savings that are expected to remain on deposit in a financial institution for an extended period.

Accepted Answer

A) True 
 B)False

Question 10

Stock brokerage firms earn commissions on clients' stock transactions.

Accepted Answer

A) True 
 B)False

Question 11

Which of the following is not true about commercial banks?

Accepted Answer

A) Commercial banks are corporations chartered under federal and state regulations. 
B) Accounts in federally chartered commercial banks are insured against loss by the Bank Insurance Fund of the Federal Deposit Insurance Corporation. 
C) Commercial banks offer numerous consumer services. 
D) Commercial banks generally pay depositors an interest rate about 0.10 to 0.20 percentage points higher than the rate found at savings banks. 
A) Commercial banks are corporations chartered under federal and state regulations. 
B) Accounts in federally chartered commercial banks are insured against loss by the Bank Insurance Fund of the Federal Deposit Insurance Corporation. 
C) Commercial banks offer numerous consumer services. 
D) Commercial banks generally pay depositors an interest rate about 0.10 to 0.20 percentage points higher than the rate found at savings banks.

Question 12

ATM transaction fees can be assessed when you make a purchase via a point-of-sale terminal at a retail store.

Accepted Answer

A) True 
 B)False

Question 13

NOW accounts and share draft accounts with tiered interest will pay higher interest rates on larger balances.

Accepted Answer

A) True 
 B)False

Question 14

In general,you will receive higher rates of interest on your certificate of deposit the ____ the maturity and the ____ the dollar amount invested.

Accepted Answer

A) shorter; smaller 
B) longer; smaller 
C) longer; larger 
D) shorter; larger 
A) shorter; smaller 
B) longer; smaller 
C) longer; larger 
D) shorter; larger

Question 15

A customer who wanted to directly transfer funds from his or her bank account to a retailer's bank account would use a(n)

Accepted Answer

A) automated teller machine. 
B) electronic funds transfer. 
C) check. 
D) credit card. 
A) automated teller machine. 
B) electronic funds transfer. 
C) check. 
D) credit card.

Question 16

The total protection an individual might have with any institution,including all its branches,is $250,000 with no more than $125,000 each on single-ownership and joint accounts.

Accepted Answer

A) True 
 B)False

Question 17

Characteristics of a savings account include that

Accepted Answer

A) no fees are assessed as long as a low minimum balance ($50 to $250) is maintained. 
B) account transactions are not accessible through ATMs. 
C) no printed receipts are provided to document account transactions. 
D) it permits the frequent deposit or withdrawal of funds. 
A) no fees are assessed as long as a low minimum balance ($50 to $250) is maintained. 
B) account transactions are not accessible through ATMs. 
C) no printed receipts are provided to document account transactions. 
D) it permits the frequent deposit or withdrawal of funds.

Question 18

In community property states,the rights of the husbands and wives are unequally protected.

Accepted Answer

A) True 
 B)False

Question 19

Having your pay sent directly to your bank rather than receiving a written check is a type of

Accepted Answer

A) shared accounting. 
B) direct deposit. 
C) check cancellation. 
D) NOW account. 
A) shared accounting. 
B) direct deposit. 
C) check cancellation. 
D) NOW account.

Question 20

A lifeline checking account is accurately described as an account that

Accepted Answer

A) always pays interest. 
B) assesses monthly fees depending on the maximum balance in the account. 
C) assesses no charges for ATM transactions. 
D) can be accessed using a debit card. 
A) always pays interest. 
B) assesses monthly fees depending on the maximum balance in the account. 
C) assesses no charges for ATM transactions. 
D) can be accessed using a debit card.

Checks mailed to the bank for deposit should always be endorsed with a restrictive endorsement.

If you have an automatic overdraft loan agreement with your bank,money will be borrowed from your MasterCard or Visa as a cash advance when you write a bad check.

The goal of monetary asset management is to maximize interest earnings and minimizing fees while keeping funds safe and readily available.

Certificates of deposit (CDs) tend to pay higher rates of interest than money market accounts because

Liquidity is the speed and ease with which an asset can be converted to cash.

The only reason to have a checking account is so that one has an account for writing checks.

If Gus believes interest rates are going to fall in the near future and remain low for several years,Gus should now

When an account pays one rate of interest on a minimum amount on deposit and a higher rate of interest on additional deposits,this is called ____ interest.

Demand deposits are savings that are expected to remain on deposit in a financial institution for an extended period.

Stock brokerage firms earn commissions on clients' stock transactions.

Which of the following is not true about commercial banks?

ATM transaction fees can be assessed when you make a purchase via a point-of-sale terminal at a retail store.

NOW accounts and share draft accounts with tiered interest will pay higher interest rates on larger balances.

In general,you will receive higher rates of interest on your certificate of deposit the the maturity and the the dollar amount invested.

A customer who wanted to directly transfer funds from his or her bank account to a retailer's bank account would use a(n)

The total protection an individual might have with any institution,including all its branches,is $250,000 with no more than $125,000 each on single-ownership and joint accounts.

Characteristics of a savings account include that

In community property states,the rights of the husbands and wives are unequally protected.

Having your pay sent directly to your bank rather than receiving a written check is a type of

A lifeline checking account is accurately described as an account that

Understanding Personal Finance

Career Planning

Financial Statements,tools,and Budgets

Managing Income Taxes

Building and Maintaining Good Credit

Credit Cards and Consumer Loans

Vehicles and Other Major Purchases

Obtaining Affordable Housing

Managing Property and Liability Risk

Managing Health Expenses

Life Insurance Planning

Investment Fundamentals

Investing in Stocks and Bonds

Mutual Funds and Exchange Traded Funds

Real Estate and High-Risk Investments

Retirement and Estate Planning

Filters

Exam 5: Managing Checking and Savings Accounts

Checks mailed to the bank for deposit should always be endorsed with a restrictive endorsement.

If you have an automatic overdraft loan agreement with your bank,money will be borrowed from your MasterCard or Visa as a cash advance when you write a bad check.

The goal of monetary asset management is to maximize interest earnings and minimizing fees while keeping funds safe and readily available.

Certificates of deposit (CDs) tend to pay higher rates of interest than money market accounts because

Liquidity is the speed and ease with which an asset can be converted to cash.

The only reason to have a checking account is so that one has an account for writing checks.

If Gus believes interest rates are going to fall in the near future and remain low for several years,Gus should now

When an account pays one rate of interest on a minimum amount on deposit and a higher rate of interest on additional deposits,this is called ____ interest.

Demand deposits are savings that are expected to remain on deposit in a financial institution for an extended period.

Stock brokerage firms earn commissions on clients' stock transactions.

Which of the following is not true about commercial banks?

ATM transaction fees can be assessed when you make a purchase via a point-of-sale terminal at a retail store.

NOW accounts and share draft accounts with tiered interest will pay higher interest rates on larger balances.

In general,you will receive higher rates of interest on your certificate of deposit the ____ the maturity and the ____ the dollar amount invested.

A customer who wanted to directly transfer funds from his or her bank account to a retailer's bank account would use a(n)

The total protection an individual might have with any institution,including all its branches,is $250,000 with no more than $125,000 each on single-ownership and joint accounts.

Characteristics of a savings account include that

In community property states,the rights of the husbands and wives are unequally protected.

Having your pay sent directly to your bank rather than receiving a written check is a type of

A lifeline checking account is accurately described as an account that

Understanding Personal Finance

Career Planning

Financial Statements,tools,and Budgets

Managing Income Taxes

Building and Maintaining Good Credit

Credit Cards and Consumer Loans

Vehicles and Other Major Purchases

Obtaining Affordable Housing

Managing Property and Liability Risk

Managing Health Expenses

Life Insurance Planning

Investment Fundamentals

Investing in Stocks and Bonds

Mutual Funds and Exchange Traded Funds

Real Estate and High-Risk Investments

Retirement and Estate Planning

Filters

In general,you will receive higher rates of interest on your certificate of deposit the the maturity and the the dollar amount invested.