pers finance ch. 5
Based on the following information, what amount would be subtracted from the bank balance side of the checking account reconciliation? Service charge $12; Outstanding checks $145; Interest $3.50; Deposit in transit $80.
145.00
An estimated _____ people in the U.S. are "unbanked", using a variety of alternative services rather than having a bank account.
17 million
Series EE bonds continue to earn interest for how many years?
30
Which of the following types of financial institutions provide Federal Deposit Insurance (FDIC) coverage?
Commercial banks, credit unions, and savings and loans
Which of the following is a way to reduce ATM surcharges?
Withdraw larger amounts rather than making multiple smaller withdrawals
A personal check with guaranteed payment is called a:
certified check
What type of account would be considered the most liquid?
checking account
Traditionally, the greatest variety of financial services is offered by:
commercial banks
Which of the following is a deposit institution?
credit union
A higher rate of return would result from a savings account that had which of the following compounding frequencies?
daily
Savings compounded ____________ would have the highest effective yield.
daily
Checking accounts are frequently referred to as ____________ deposits.
demand
A certificate of deposit is usually considered to be very liquid.
false
The more frequent the compounding, the less a person will earn on a savings account.
false
When preparing a bank reconciliation, interest earned on your checking account is added to the bank statement balance.
false
Joan Zemke expects interest rates to decline over the next few months. To maximize her earnings she should use a(n):
five-year certificate of deposit
Which CD pays earnings based on the stock market?
indexed
Which of the following is a drawback of a money market fund from an investment company?
lack of FDIC insurance
Which of the following is not a deposit institution?
life insurance company
Which one of the following savings plans is not covered by federal deposit insurance?
money market fund with an investment company
What type of account would you expect to provide the poorest yield?
passbook savings account
Which one of the following financial service providers should be avoided because the loans they offer are considered expensive and high-risk?
pawn shop
Which type of organization does not provide home mortgages?
payroll check cashing services
time deposits are another name for
savings accounts
A savings account at a credit union is called a ____________ account.
share
When interest rates are rising, a person would be best served by:
short-term savings instruments.
Higher returns on savings will usually result in less liquidity.
true
Savings and loan associations offer mortgages.
true
The money market fund offered by investment companies is a relatively liquid financial service.
true
Using a "debit" card is basically the same as writing a check.
true
