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- 1. Multiple ChoiceInterest is:a charge for lending money to a bankthe amount owed for borrowing moneythe amount added into your savings when opening a bank accounta charge for the convenience of accessing money stored in your bank account
- 2. Multiple ChoiceAnthony is deciding between different savings accounts at his bank. He has four options,based on how frequently interest compounds. Which should he choose if he wants the best rate of return on his interest?Annual CompoundingSemi-Annual CompoundingMonthly CompoundingDaily Compounding
- 3. Multiple ChoiceTo earn as much interest as possible, you should open a savings account that earns _______interest and has the ______ interest rate.compound; lowestcompound; highestsimple; lowestsimple; highest
- 4. Multiple ChoiceWhat is the typical relationship between time and interest rate?Longer time period usually equals higher interest ratesShorter time period usually equals higher interest ratesLonger time periods usually have no effect on interest rates.Shorter time periods usually have no effect on interest rates.
- 5. Multiple ChoiceJane just opened a savings account and wants to maximize the amount of interest she earns.Which of the following actions would enable her to earn MORE interest?Selecting an account with a high interest rate.Leaving his money in the account for long period of time.Transferring money into his checking account each month.Both A & B
- 6. Multiple ChoiceTamara has $500 she is looking to save for a class trip. She wants to earn the most possible interest and will not need access to her money for a full year. Which type of savings account will be best for Tamara?Certificate of Deposit (CD)Money Market AccountSavings AccountChecking Account
- 7. Multiple ChoiceYou are opening a savings account that earns compound interest. Which compounding frequency will earn you the MOST money?Compounding 1 time a yearCompounding 4 times a yearCompounding monthlyCompounding daily
- 8. Multiple ChoiceWhich of the following is considered a "need"?FoodPizzaGatoradeFruit
- 9. Multiple ChoiceWhich of the following is a type of savings vehicle?Certificate of DepositMoney Market AccountChecking AccountBoth A & B
- 10. Multiple ChoiceWhich type of account typically has very high liquidity, low or no interest, and low minimum balance?Checking AccountMoney Market AccountCertificate of Deposit (CD)Investment Retirement Account (IRA)
- 11. Multiple ChoiceWhich of the following is generally true about savings vehicles?Savings vehicles are only useful for long-term investments.People should evaluate different forms of savings vehicles based on their needs.Savings vehicles are never insured.All of the above
- 12. Multiple ChoiceWhich of the following is considered a "want"?A warm winter coatShoesDesigner SneakersSocks
- 13. Multiple ChoiceWhich of the following accounts will give you the LEAST access to your money?Simple savings accountCertificate of Deposit (CD)Checking accountCash
- 14. Multiple ChoiceWhen it comes to saving money, what is a good rule of thumb?Keep most of your savings in your checking accountPut aside money for savings each monthChoose the savings account with the lowest interest ratePut anything you can’t afford on your credit card
- 15. Multiple ChoiceYou can only open a saving account at a bankTrueFalse
- 16. Multiple ChoiceIn order to open a savings account you need a drivers licenseTrueFalse
- 17. Multiple ChoiceThe standard deposit insurance on a savings account is100,000.00150,000.00200,000.00250,000.00
- 18. Multiple ChoiceA money market account is a type of savings accounttruefalse
- 19. Multiple ChoiceTo help maintain this reserve, there is a limit of _ monthly withdrawals on a savings account based on the Federal Reserve Regulation D.4567
- 20. Multiple ChoiceYou can open up a savings account on-lineFalseTrue
- 21. Multiple ChoiceThe best approach to saving money is to pay yourself first.TrueFalse
- 22. Multiple ChoiceUsing a savings account creates some distance between everyday spending money and cash that’s meant for a later date, like an emergency fund or vacation savings.TrueFalse
- 23. Multiple ChoiceCertificate of deposit, or CD, holds money for a fixed term, anywhere from a few months to a few years.TrueFalse
- 24. Multiple ChoiceOpen a CD only with money you won’t need immediately, because withdrawing money before the end of the term carries a penalty.TrueFalse
- 25. Multiple ChoiceA CD (Certificate of Deposit account ) usually offers the highest annual percentage yield; the longer the term you commit to, the higher the interest rate.TrueFalse
- 26. Multiple ChoiceThe best part of a savings account is that it requires a low minimum balance like $25.00 or sometimes no minimum balance at allTrueFalse
- 27. Multiple ChoiceFDIC Stands forFederal Direct Insurance CorporationFederal Deposit Insurance CorporationFederal Direct Insurance CompanyFederal Deposit Insurance Company
- 28. Multiple ChoiceThe FDIC is a part of the federal government?FalseTrue
- 29. Multiple ChoiceInterest on savings accounts is usually compounded daily and paid monthlyTrueFalse
- 30. Multiple Choicebanks are commercial businesses, credit unions are typically non-profit cooperative organizationsTrueFalse
- 31. Multiple ChoiceBanks usually offer two types of savings accounts: a basic savings account, and a money market account.TrueFalse
- 32. Multiple ChoiceThe beginning balance is typically your first deposit into your savings accountTrueFalse
- 33. Multiple ChoiceA statement is something you get each month from your bank or credit union that shows you all of your transactions on your accountTrueFalse
- 34. Multiple ChoiceWhat does it mean to reconcile your account?Review the statement you receive each month from the bankClose your accountGo through your deposits and withdrawals and make sure they match the banksGo into the bank each month
- 35. Multiple ChoiceBanks and Credits unions make money off of your account byCharging Fees and PenalitiesReinvesting The MoneyInvesting your money into off shore accountsBoth A and B
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