Behaving in this Economy
This field of study combines both economics and psychology to study why people behave the way they do in the real world.
Behavioral Economics
This type of banking refers to using smartphones and apps to manage your accounts.
Mobile banking
10%
Check cashing, debit card, more number of allowed transactions, etc.
An investment that is a form of equity ownership in a company, represented as a share.
Stock
A error in our thinking that can influence our decisions.
Cognitive Bias
This type of account locks your money for a specified time period (3 months, 6 months, 1 year) but pays a higher interest rate than a savings account.
Certificate of Deposit (CD)
3-6 months of expenses.
You earned a $50 check doing yard work for your neighbors. Describe one easy way to deposit that check.
Mobile banking app, or visit your bank teller.
The average return of the U.S. stock market over the past 100 years.
Roughly 10%
The term for how we feel losses more than we enjoy similar gains is known as? For example, we would rather not lose $5 as opposed to win $5.
Loss Aversion
Similar to a checking account, but with a higher interest rate but less allowed transactions per month.
Money Market Account
Name at least two Peer to Peer Payment (P2P) apps.
Venmo, CashApp, PayPal, Zelle.
Factors that may influence which bank you choose to use may include:
Low fees, ease of access, mobile banking apps, higher interest rate on savings or CD's, checking or debit card benefits, safety and security.
The most valuable U.S. company by market capitalization (shareholder value), at $4.137 trillion.
NVIDIA
Our tendency to act based on what other people are doing.
Herd Mentality
The federal agency that insures bank accounts for up to $250,000 each in the event a bank goes bankrupt.
Federal Deposit Insurance Corporation (FDIC)
Besides traditional banks, name two other financial institutions where a consumer could place their money.
Credit Unions, Online Banks, Peer to Peer Apps
Describe two types of "predatory lenders" that provide financing for consumers but at high interest rates, high fees, and sometimes at the cost of your own vehicle.
Payday loans, title loans, check-into-cash, loan sharks.
The most profitable U.S. company based on earnings (revenue - expenses), at $140 billion last year.
The tendency to value something more once we own it.
Endowment Effect
List three types of banking fees one may encounter each month.
ATM fees, overdraft fees, and monthly maintenance fees.
Provide two reasons why it is important to read your bank statement each month.
To check for any errors on transactions, to check for fraudulent purchases, to verify fees, to see your balance, and to see which checks have been cashed/processed that you have written.
Which type of interest gains money not only on the original investment, but also on the previous investment returns.
Compound Interest
The percentage of entrepreneurs that not only own one business, but multiple businesses.
One third (33%)