Depository Institutions
Levi was working on developing a savings mentality and was classifying his needs and wants. Which of the following would be considered a want.
a. Groceries
b. The latest iphone that was just released.
c. Clothes for upcoming interviews
d. A used car to replace the one too expensive to repair.
b. The latest iphone that was just released.
This savings tool has a fixed interest rate and maturity date. It also has a penalty for early withdrawal. This savings tool is known as a?
a. Certificate of Deposit (CD)
b. Money Market Account
c. High Yield Checking Account
d. Savings Account
a. Certificate of Deposit (CD)
How many months (range of months) of your fixed expenses should you set aside for emergencies?
a. 1 - 2 months
b. 3 -6 months
c. 7 - 9 months
d. 12 months
b. 3 -6 months
Depository Institutions offer all of the following except?
a. Checking
b. Savings
c. Investments
d. All of the above are offered.
d. All of the above are offered.
Lizabeth was listing her future needs and goals and wondered which of the following would be considered a short-term need?
a. Retirement
b. Buying a house
c. Her kids education
d. Emergencies
d. Emergencies
Which of the following is a good savings strategy?
a. Budget for savings
b. Save whatever is leftover after paying expenses
c. Save as much as you can even if you don't pay all of your bills
d. None of the above
a. Budget for savings
A great way to start saving money is to start with the basics. This means to open a basic savings account and…
a. Open a no fee checking account
b. Open an interest bearing checking account
c. Open another savings account at a different bank
d. None of the above
a. Open a no fee checking account
FDIC insures depositors up to ___________?
a. $150,000
b. $250,000
c. $500,000
d. $100,000
b. $250,000
Which of the following is not a rule of good spending habits?
a. Spend less than you make.
b. Save first, spend later.
c. Track spending
d. Spend first, save later.
d. Spend first, save later.
Which of the following is NOT a way you can access money from your online checking account?
a. Online Transfer
b. Debit Card
c. Write a check
d. All of the following are ways you can access your money from an online checking account.
d. All of the following are ways you can access your money from an online checking account.
If you have $1,200 and make 6% compound interest, how much would you have after two years?
a. $1,457.80
b. $1,348.32
c. $1,100.00
d. $2,010.04
b. $1,348.32
What are the two main types of depository institutions?
a. Credit Unions & ATMs
b. For-profit & Not-for-profit
c. FDIC & NCUA
d. Commercial Banks & Credit Unions
d. Commercial Banks & Credit Unions
______________ refers to how quickly you can turn your account/funds to usable cash.
a. Interest
b. Liquidity
c. Deposit
d. Withdrawal
b. Liquidity
Which of the following savings tools might have a 6 month maturity but pay a slightly higher interest rate than a savings account? (Lesson 3-2)
a. Checking Account
b. Money Market Account
c. Certificate of Deposit (CD)
d. Savings Account
c. Certificate of Deposit (CD)
Starting an emergency fund is another way to save. You should have 3 - 6 months of your ________ for emergencies.
a. Variable Expenses
b. Fixed Expenses
c. Net Income
d. Withholding Allowances
b. Fixed Expenses
Which of the following financial institutions is recognized by being non-profit and profits are returned as dividends to customers?
a. Commercial Banks
b. Credit Unions
c. Savings and Loan Institutions
d. Investment Companies
b. Credit Unions
How much should you save for your emergency fund?
a. 3-6 months rent
b. 3-6 months of income
c. 3-6 months of fixed expenses
d. 2 months of living expenses
c. 3-6 months of fixed expenses
Which savings tool provides interest rates that increase as you keep greater balances in the account?
a. Checking Account
d. Certificates of Deposit (CD)
c. Tiered Savings Account
d. High Yield Checking Account
c. Tiered Savings Account
The addition of interest to the principal sum of a loan or deposit is called ____________?
a. Compound Interest
b. Simple Interest
c. Monthly payment
d. Loan Balance
a. Compound Interest
If John has an individual account for $300,000 at bank ABC and $200,000 in his retirement account at bank ABC, how much is covered under FDIC protection?
a. $450,000
b. $0
c. $250,000
d. $500,000
a. $450,000