Personal Finance: chapter 4

In which of the following are most of the investments insured? a. Commercial bank b. Check-cashing outlet c. Pawnshop d. Payday loan facility e. Rent-to-Own Center

A. Commercial bank

A legal agreement that provides for the management and control of assets is known as a. a trust b. a loan c. a checking account d. a savings account e. none of the above

a. a trust

Many people make mistakes when managing current cash needs. Which of these is NOT a frequently made mistake? a. Borrowing for current expenses b. Budgeting spending c. Failing to put extra funds in an investment plan d. Having insufficient liquid assets to pay bills e. Overspending due to impulse buying on credit

b. Budgeting spending

Which of the following usually offers mutual funds? a. credit card company b. investment company c. life insurance company d. mortgage company e. payday loan company

b. investment company

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. $25 c. $50 d. $173 e. cannot be determined with the information provided

c. $50

Earnings on savings can be measured by the a. Compounding b. Liquidity c. Minimum deposit d. Rate of return e. Safety

d. Rate of return

A time deposit is also known as a. a checking account b. a trust c. a loan d. a savings account e. all of the above are time deposits

d. a savings account

Franklin is planning for a purchase of a vehicle in two years. Since he wants to be certain that his funds are safe, which of the following should he use? a. a checking account b. a trust c. a loan d. a savings account e. home mortgage

d. a savings account

A drawback of a savings account is a. easy access to deposits b. insured c. low minimum balance d. low rate of return e. no penalty for early withdrawal

d. low rate of return

Common payment choices for everyday activities include all except a. cash b. check c. credit card d. short-term loan e. debit card

d. short-term loan