Exam 5: Managing Checking and Savings Accounts

Andy and Marjorie have very little will power when it comes to spending.They want to put their savings in an instrument that cannot be accessed by their ATM card.Which instrument would meet this criterion?

One should accumulate enough savings to cover living expenses for six to nine months.

A stop-payment order works only if the check has not yet cleared your financial institution.

Money withdrawn from a CD before the end of the specified time period is subject to interest penalties.

Writing a "bad check" can be very expensive because of fees assessed by both the bank and the payee.

Interest-earning checking accounts are offered through savings banks and mutual savings banks as well as credit unions.

To reduce interest rate risk and smooth out interest rate fluctuations when purchasing certificates of deposit (CDs)you can engage in

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

Institutions usually have a rule requiring that savings account holders give 30 to 60 days notice for withdrawals,although this restriction is seldom enforced.

Electronic funds transfers (EFTs)

Wise money managers should select the savings option that

____ typically pay the highest rates of interest on savings.

The primary focus of savings banks is to accept savings from consumers and provide mortgage and consumer loans.

Darla had $750 in her checking account when her debit card was stolen.Assuming the thief made $525 in purchases with the card,how much could she save by reporting the stolen ATM card immediately rather than waiting more than three months before reporting the theft?

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

Special concerns for blended families include

The more frequent the compounding,the greater the effective return for the saver.

Diana and Kim are roommates in college and Diana owes Kim for last month's rent.When Diana receives a check from her mother for the rent,what type of endorsement should Diana use to sign this check over to Kim?

Today,even stock brokerages and insurance companies provide certain products for use in cash management.

A checking account that does not pay interest is called a