Question 1

Which of the following is true of asset management accounts?

Accepted Answer

A)  Limited free checking of available balance
B)  Sweeping of excess balances into money market deposit account (MMMF) 
C)  Fixed annual fees and account charges on deposit account
D)  Borrowing and investing facility unavailable to accountholders
E)  Deposits are protected by the Securities Investor Protection Corporation (SIP
C)  F) A) and B)
G) All of the above

Question 2

Mary has calculated her adjusted balance as $500.She notices that her bank's service charges are $20 for this period.Mary's ending balance in her bank account is _____.

Accepted Answer

A)  $520
B)  $480
C)  $600
D)  $500
E)  $510F) B) and C)
G) B) and E)

Question 3

At maturity,a deposit of $6,000 in a certificate of deposit (CD) for 10 years at 3% will be worth: (Select the closest answer.)

Accepted Answer

A)  $7,340.
B)  $7,800.
C)  $8,064.
D)  $8,678.
E)  $9,005.F) A) and D)
G) A) and E)

Question 4

Which of the following are protected by the Federal Deposit Insurance Corporation (FDIC) ?

Accepted Answer

A)  Money market deposit accounts
B)  Money market mutual funds
C)  Asset management accounts
D)  Stocks and bonds
E)  Life insurance policiesF) None of the above
G) B) and E)

Question 5

Liquid assets would include your savings account and your ____________. ​

Accepted Answer

A)  money market deposit account
B)  10-year Treasury bond
C)  3-year certificate of deposit purchased in the current financial year
D)  Series EE U.S.savings bondE) None of the above
F) All of the above

Question 6

Low interest rates create economic distortions,especially when real,inflation-adjusted interest rates are positive.

Accepted Answer

A) True 
 B)False

Question 7

The least expensive method for banks to interact with their customers is:

Accepted Answer

A)  through a vendor.
B)  through phone calls.
C)  through the Internet.
D)  through an ATM machine.
E)  through a full-service teller.F) C) and D)
G) A) and D)

Question 8

In account reconciliation,one of the steps in calculating adjusted bank balance is ____________. ​

Accepted Answer

A)  deducting total withdrawals still outstanding from bank balance
B)  deducting total deposits still outstanding from bank balance
C)  adding total credit card outstanding balance to bank balance
D)  adding bank service charges to bank balanceE) None of the above
F) A) and B)

Question 9

Credit unions are:

Accepted Answer

A)  member-owned financial cooperatives.
B)  mortgage lenders.
C)  available to the general public.
D)  special commercial lenders.
E)  large institutions when compared with commercial banks.F) A) and C)
G) B) and E)

Question 10

A check you issued last week has been stolen.You can prevent the amount on the check from being withdrawn from your account by an unauthorized person by:

Accepted Answer

A)  writing a new check.
B)  depositing the correct amount of money.
C)  requesting a stop payment.
D)  tearing up the check.
E)  properly endorsing the check.F) C) and D)
G) A) and B)

Question 11

A certified check is a personal check that a bank certifies to guarantee that funds are available.

Accepted Answer

A) True 
 B)False

Question 12

Your savings will grow faster with monthly interest compounding than with quarterly interest compounding for a given nominal interest rate.

Accepted Answer

A) True 
 B)False

Question 13

The Federal Deposit Insurance Corporation (FDIC) insures each ____________ up to a stated maximum dollar amount at any given financial institution. ​

Accepted Answer

A)  depositor
B)  account
C)  shareholder
D)  bankE) C) and D)
F) All of the above

Question 14

You are going on an overseas trip,and you want to carry checks.You should purchase:

Accepted Answer

A)  cashier's checks.
B)  certified checks.
C)  conditional checks.
D)  traveler's checks.
E)  guaranteed checks.F) B) and C)
G) A) and E)

Question 15

The Federal Deposit Insurance Corporation (FDIC)covers stocks,bonds,and mutual funds purchased at banks.

Accepted Answer

A) True 
 B)False

Question 16

People who do not have checking accounts often use ____________. ​

Accepted Answer

A)  a cashier's check
B)  overdraft protection
C)  a debit card
D)  a checkbook ledgerE) B) and C)
F) A) and B)

Question 17

Kate tends to issue checks quite often without having sufficient balance in her account.She should look for an account with a(n) ____________ facility. ​

Accepted Answer

A)  ATM
B)  overdraft protection
C)  trust services
D)  mutual fund managementE) A) and B)
F) All of the above

Question 18

Low interest rates ____________. ​

Accepted Answer

A)  increase the number of financial institutions
B)  do not impact the supply of credit
C)  increase the demand for lower-grade riskier bonds
D)  decrease employment opportunitiesE) A) and D)
F) B) and C)

Question 19

Interest rates are the lowest on ____________. ​

Accepted Answer

A)  savings accounts
B)  regular checking accounts
C)  money market deposit accounts
D)  certificates of depositE) All of the above
F) A) and B)

Question 20

A bank customer withdraws funds by writing checks from his or her negotiable order of withdrawal (NOW) account and:

Accepted Answer

A)  certificate of deposit.
B)  regular checking account.
C)  term insurance deposit.
D)  time deposit.
E)  savings account.F) None of the above
G) A) and C)

Exam 4: Managing Your Cash and Savings

At maturity,a deposit of $6,000 in a certificate of deposit (CD) for 10 years at 3% will be worth: (Select the closest answer.)

Correct AnswerverifiedShow Answer

Which of the following is true of asset management accounts?

Correct AnswerverifiedShow Answer

A check you issued last week has been stolen.You can prevent the amount on the check from being withdrawn from your account by an unauthorized person by:

Correct AnswerverifiedShow Answer

The Federal Deposit Insurance Corporation (FDIC) insures each ____________ up to a stated maximum dollar amount at any given financial institution. ​

Correct AnswerverifiedShow Answer

A bank customer withdraws funds by writing checks from his or her negotiable order of withdrawal (NOW) account and:

Correct AnswerverifiedShow Answer

Credit unions are:

Correct AnswerverifiedShow Answer

Interest rates are the lowest on ____________. ​

Correct AnswerverifiedShow Answer

In account reconciliation,one of the steps in calculating adjusted bank balance is ____________. ​

Correct AnswerverifiedShow Answer

Kate tends to issue checks quite often without having sufficient balance in her account.She should look for an account with a(n) ____________ facility. ​

Correct AnswerverifiedShow Answer

Your savings will grow faster with monthly interest compounding than with quarterly interest compounding for a given nominal interest rate.

Correct AnswerverifiedShow Answer

Low interest rates ____________. ​

Correct AnswerverifiedShow Answer

Which of the following are protected by the Federal Deposit Insurance Corporation (FDIC) ?

Correct AnswerverifiedShow Answer

The Federal Deposit Insurance Corporation (FDIC)covers stocks,bonds,and mutual funds purchased at banks.

Correct AnswerverifiedShow Answer

You are going on an overseas trip,and you want to carry checks.You should purchase:

Correct AnswerverifiedShow Answer

Mary has calculated her adjusted balance as $500.She notices that her bank's service charges are $20 for this period.Mary's ending balance in her bank account is _____.

Correct AnswerverifiedShow Answer

Low interest rates create economic distortions,especially when real,inflation-adjusted interest rates are positive.

Correct AnswerverifiedShow Answer

The least expensive method for banks to interact with their customers is:

Correct AnswerverifiedShow Answer

Liquid assets would include your savings account and your ____________. ​

Correct AnswerverifiedShow Answer

People who do not have checking accounts often use ____________. ​

Correct AnswerverifiedShow Answer

A certified check is a personal check that a bank certifies to guarantee that funds are available.

Correct AnswerverifiedShow Answer

Correct Answer
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The Federal Deposit Insurance Corporation (FDIC) insures each ____________ up to a stated maximum dollar amount at any given financial institution.

Correct Answer
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Interest rates are the lowest on ____________.

Correct Answer
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In account reconciliation,one of the steps in calculating adjusted bank balance is ____________.

Correct Answer
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Kate tends to issue checks quite often without having sufficient balance in her account.She should look for an account with a(n) ____________ facility.

Correct Answer
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Correct Answer
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Low interest rates ____________.

Correct Answer
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Liquid assets would include your savings account and your ____________.

Correct Answer
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People who do not have checking accounts often use ____________.

Correct Answer
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Correct Answer
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