Chapter 4

A time deposit is also known as A) A savings account. B) A loan. C) A checking account. D) A trust. E) All of these are time deposits.

a savings account

Brandon lost his debit card. When he realized it was gone, his account had $238 in unauthorized charges. Since he was embarrassed about his loss, he didn't contact his financial institution for 70 days. What is the most that he is liable for? A) $238 B) $188 C) $0 D) $50 E) $500

$238

Brenda lost her debit card. When she realized it was gone, her account had $173 in unauthorized charges. She notified her financial institution within two days. How much is she potentially liable for? A) $0. B) $173. C) $25. D) $500. E) $50.

$50

A demand deposit is also known as A) A loan. B) A savings account. C) A trust. D) A checking account. E) All of these are demand deposits.

a checking account

Cathy needs a full range of financial services, including checking, savings, and lending. To which of the following should she go? A) A pawnshop B) A commercial bank C) A rent-to-own center D) A check-cashing outlet E) A payday loan company

a commercial bank

Which of the following is organized as a corporation with investors (stockholders) contributing the needed capital to operate? A) A commercial bank B) A payday loan facility C) A rent-to-own center D) A check-cashing outlet E) A pawnshop

a commercial bank

Which of the following offers a full range of financial services including checking, savings, lending, and other services? A) A payday loan company B) A rent-to-own center C) A pawnshop D) A check-cashing outlet E) A commercial bank

a commercial bank

Billy accepted a job at a company that specializes in providing money for short-term retail lending. Where did he go to work? A) A life insurance company B) A finance company C) An investment company D) A credit card company E) A payday loan company

a credit card company

All of the following are non-deposit institutions except A) A credit card company. B) A finance company. C) A credit union. D) An investment company. E) A life insurance company.

a credit union

All of the following are deposit institutions except A) A mutual savings bank. B) A credit union. C) A savings and loan association. D) A finance company. E) A commercial bank.

a finance company

Zach wants to open an account, but he doesn't know which kind is appropriate. He is interested in earning a higher interest rate and knows that he might not be able to write many checks from his account. In addition, he plans to keep at least $1,000 in his account so he can avoid paying a fee. He definitely wants to have federal deposit insurance. What kind of account should he open? A) A money market fund B) A certificate of deposit C) An interest-earning checking account D) A money market account E) A regular savings account

a money market account

Amber wants to open an account, but she doesn't know which kind is appropriate. She is interested in earning a higher interest rate and plans to keep at least $1,000 in her account so she can avoid paying a fee. Amber wants to open her account at an investment company and understands that her account will not be covered by federal deposit insurance. What kind of account should she open? A) An interest-earning checking account B) A certificate of deposit C) A money market fund D) A regular savings account E) A money market account

a money market fund

Which of the following primarily provides loans for home purchases? A) A life insurance company B) A payday loan company C) A mortgage company D) A credit card company E) An investment company

a mortgage company

Harvey needed some cash quickly, so he received a short-term loan based on the value of an old ring. Where did he go? A) A pawnshop B) A payday loan company C) A rent-to-own center D) A check-cashing outlet E) A commercial bank

a pawnshop

When Imogene brought a necklace to a ________, she received a loan based on its value. A) commercial bank B) pawnshop C) rent-to-own center D)check-cashing outlet E) payday loan company

a pawnshop

Which of the following will likely provide the most expensive loans? A) An investment company B) A life insurance company C) A credit card company D) A finance company E) A payday loan company

a payday loan company

A drawback of a regular savings account is A) A relatively low rate of return. B) A minimum required deposit. C) A possible penalty for early withdrawal. D) Not being insured. E) All of these are drawbacks of a regular savings account.

a relatively low rate of return

A drawback of a regular savings account is A) A low minimum balance. B) Easy access to deposits. C) Being insured. D) Ease of withdrawal. E) A relatively low rate of return.

a relatively low rate of return

Franklin is planning for a purchase of a vehicle in two years. Since he wants to be certain that his funds are safe (insured), which of the following should he use? Correct Answer A) A savings account. B) A trust. C) A home mortgage. D) A loan. E) A credit card.

a savings account

A legal agreement that provides for the management and control of assets by one party for the benefit of another is known as A) A trust. B) A checking account. C) A savings account. D) A loan. E) None of these.

a trust

Claudette's grandchildren are 7 and 9 years old. When Claudette passed away, her grandchildren inherited her money. However, the will stipulated that they should not get control of the money until age 25. Which of the following should be set up to provide for the management and control of the funds? A) A checking account B) A loan C) A certificate of deposit D) A trust E) A savings account

a trust

When you select a financial services provider, you should ask all of the following questions except A) How can I minimize the cost of checking and payment services? B) Where can I get the best return on my savings? C) Will I be able to borrow money if I need it? D) All of these questions should be asked. E) None of these questions are needed.

all of these questions should be asked

An all-in-one account that provides a complete financial services program for a single fee is known as A) A loan. B) A savings account. C) An asset management account. D) A trust. E) A checking account.

an asset management account

Which of the following usually offers money market mutual funds? A) A life insurance company B) A finance company C) An investment company D) A payday loan company E) A credit card company

an investment company

ATM stands for A) Available token machine. B) Available teller machine. C) Automatic taking machine. D) Automatic token machine. E) Automatic teller machine.

automatic teller machine

Many people make mistakes when managing current cash needs. Which of these is NOT a frequently made mistake? A) Using savings or borrowing to pay for current expenses B)Failing to put unneeded funds in an investment plan C) Overspending due to impulse buying and over using credit D) Budgeting spending E) Having insufficient liquid assets to pay current bills

budgeting spending

When you select a financial services provider, you may find all of the following to be major factors except A) Convenience. B) Personal service. C) Company logo. D) Rates for savings and borrowed funds. E) Fee structure and other charges.

company logo

Investments, insurance, and tax assistance are tools for financial planning and are also known as A) Savings accounts. B) Checking accounts. C) Trusts. D) Loans. E) Financial services.

financial services

When Angela wanted to provide financial security for her dependents, she considered purchasing a product that would provide income replacement in the event of her untimely death and also provide a savings/investment component while she is alive. Which company would she most likely do business with? A) Investment company. B) Finance company. C) Payday loan company. D) Life insurance company. E) Credit card company.

life insurance company

A credit card is a type of A) Savings account. B) Cash account. C) Loan/borrowing. D) Checking account. E) Trust.

loan/borrowing

Another name for a regular savings account is a A) Checking account. B) Certificate of deposit. C) Money market fund. D) Passbook or statement account. E) Money market account.

passbook or statement account

Louise got caught in a cash flow trap and desperately needed money quickly. Unfortunately, she didn't shop around and she went to a ________. As a result, her annual percentage rate was higher than 780%. A) check-cashing outlet B) commercial bank C) pawnshop D) rent-to-own center E) payday loan company

payday loan company

When Jack picked up a personal computer from the ________, he was really leasing it. A) commercial bank B) rent-to-own center C) check-cashing outlet D) pawnshop E) payday loan company

rent-to-own center

Common payment choices for everyday activities include all of the following except A) Cash. B) Debit card. C) Check. D) Credit card. E) Short-term loan.

short term loan

Which of the following is NOT a financial publication that can provide information about financial services and economic conditions? A) Forbes B) The Wall Street Journal C) The Financial Times D) Bloomberg Businessweek E) The Daily Market

the daily market

Why are some financial service operations referred to as financial supermarkets? A) They have many locations, like supermarkets. B) Their prices are similar to those in a supermarket. C) They are often located in supermarkets or convenience stores. D) They offer a combination of services from one source. E) Customers can receive cash and a receipt.

they offer a combination of services from one source