Unit 8 Study Guide

Banks are for-profit companies owned by shareholders, and credit unions are not-for-profit institutions owned by their customers.

True

Credit unions and banks provide similar types of financial services.

True

Most basic checking accounts do not pay interest on the balance of your account.

True

Which of the following is NOT a way to avoid an overdraft charge?

Visit a branch within 2 days to have the fee removed

Cornelius is 17 years old. Can he open a checking account in Alabama?

Yes, if a person 19 or older is also on the account

Card linked to a checking account that can be used to withdraw money at an ATM or to make purchases.

Credit card

Which of the following is a payment service?: savings account, checking account, internet banking, or ATM machine.

Internet banking

If you don't have a traditional bank account and you need money from a check, you may visit this financial institution, where they happily help you, for a fee.

Check cashing service

Which of the following is NOT an example of a loan service?: credit card, car loan, direct deposit, or mortgage.

Credit card

Which of the following is NOT an example of a secured loan?:car loan, debit card, mortgage, or motorcycle loan.

Debit card

Bank and credit unions do not usually charge fees for processing overdrafts.

False

It is best to write your checks in pencil so you can easily erase any mistakes.

False

Credit unions usually pay a ______________ interest rate on savings accounts and a ____________ interest rate on loans than banks.

Higher; lower

A financial institution that specializes in helping people get a loan to purchase a house.

Mortgage company

This type of financial institution has come under fire recently for targeting the poor and most vulnerable people in society with extremely high interest rates.

Payday lenders

Some financial institutions charge a fee for checking accounts, while other financial institutions provide customers with a free checking account.

True

What is the amount the FDIC insures deposits in a bank or credit union?

$250,000

Which of the following is not a typical fee charged by a bank or credit union?: ATM fee, low balance fee, notary public fee, or overdraft fee.

ATM fee

A financial institution that handles money, including keeping it safe for saving or commercial purposes.

Bank

When writing a check amount, the most important thing to get right are the numerals. It's not as important to get the wording correct as long as the teller knows what you meant to write.

False

Which of the following is an example of an unsecured loan?: credit card, car loan, student loan, mortgage.

Student loan and credit card

Which of the following is NOT a savings account service?: Money market account, checking account, traditional savings account, or certificates of deposit.

Checking account