Smartbook #4 CH.5
What type of financial institution typically does not have federal deposit insurance?
Investment companies
True or false: The rate of return you earn on your savings account should be compared with the inflation rate.
True
A blank is used to add funds to an account.
deposit ticket
Overdraft protection is an automatic loan made to checking account customers to cover checks written in excess of:
their balance.
You are in the 25% tax bracket. So, the yield on the savings account is 8%, and the after-tax savings rate of return is
6%
Fraud charges on a debit card should be reported within blank days of receiving your statement to protect your right not to be charged for the transaction.
6o days
You are in the 25% tax bracket, the after tax savings rate of return is 6%, the before-tax yield on the savings account is:
8%
Blank allow you to make a payment that the recipient knows is valid.
Certified checks, cashier's checks, and money orders
What types of financial institutions have federal deposit insurance through FDIC?
Commercial banks, credit unions, & savings and loans.
Select the bonds that are a type of federal savings bond:
EE & I
Achieving your blank goals and carrying out your daily activities require many financial services.
Financial
Blank is the attribute of savings accounts that allows you to withdraw money on short notice without a loss of principal or fees.
Liquidity
Blank bonds are not a type of federal savings bond.
Municipal
Which of the following are deposit-type institutions that serve as financial intermediaries?
Saving & loans, credit unions, & commercial banks.
Which of the following attributes is not important when selecting a financial institution?
There is a state or national charter for the institution.
What is the purpose of liquidity?
To allow you to withdraw money on short notice
True or false: Achieving your financial goals and carrying out your daily activities require various financial services.
True
True or false: Financial services can change due to such factors as changing interest rates and rising consumer prices.
True
A regular savings account usually does not have:
a high rate of interest, overdraft protection, a high balance requirement.
A regular savings account usually offers:
a low or no minimum balance requirement
A regular savings account usually offers:
a low or no minimum balance requirement.
Share draft accounts at a credit union:
are interest bearing.
Use a debit card to:
avoid bills to be paid in the future, limit your spending to available money, avoid interest payment or an annual fee, & obtain better protection.
When comparing savings accounts rates of return, you should choose one that:
beats the rate of inflation.
Financial services include:
borrowing, insurance, investments, payment services, financial planning, and savings.
A blank is a check drawn on a financial institution.
cashier's check
A savings plan that requires a certain amount of money to be left for a specified amount of time, subject to penalty for early withdrawal, is called a
certificate of deposit.
The savings alternative that offers less liquidity is:
certificates of deposit.
A blank is a personal check with guaranteed payment.
certified check
Minimizing bank fees may require:
comparing financial institutions.
Overdraft protection is designed to:
cover underfunded checks.
Using savings for blank living expenses is one of the mistakes people make when managing current cash needs.
current
Financial services include all of the following except:
debt counseling
Use a credit card to:
delay payment for a purchase, build a credit history with wise buying, buy online or for major purchases, & earn more generous rewards points for spending.
Benefits of money market accounts include:
deposit insurance & a favorable interest rate.
A blank is used to add funds to a checking account
deposit ticket or slip
Some things to consider when selecting your financial institution include:
fees & charges, services offered, online banking, & convenience.
A money order:
guarantees payment.
Drawbacks of money market accounts include:
higher minimum balance required & some institutions charging for low balances.
Common choices for making payments include all of the following except:
installment loans.
All of the following are deposit-type institutions that serve as financial intermediaries except:
insurance companies.
By comparing financial institutions, a customer can:
lower bank fees & minimize ATM fees.
A blank fund is an account used for savings offered by investment companies.
money market
The savings alternative that offers more liquidity is:
money market accounts.
Common payment choices do NOT include
municipal and corporate bonds.
An blank is what you give up when you evaluate, select, and use financial services.
opportunity cost
The blank is the percentage increase in the value of savings as a result of interest earned.
rate of return
A money market fund is a
savings instrument.
A blank is an interest-bearing checking account at a credit union.
share draft account
Online payments do NOT include:
smart cards
A savings plan that requires a certain amount of money to be left for a specified amount of time is NOT a:
stock option, passbook savings account, & money market account.
Financial services will usually not be affected by:
stock prices
Common mistakes made when managing current cash needs include:
using savings for current expenses, overspending, lacking sufficient funds.
An opportunity cost is:
what you give up
