True/False
Money Compounded quarterly
earns more total interest than
money compounded annually?
True
True/False
Credit unions do not provide
insurance for their depositor’s
savings.
False
TRUE/False
Early withdrawal penalties are
charged against certificates of
deposit for withdrawals prior to
maturity.
True
True/False
Credit unions are for-profit
organizations.
False
True/False
Almost all commercial banks
have insurance with the FDIC.
True
True/False
Your goals for saving money will
affect your choice of a financial
institution.
True
True/False
The chief reason for saving money is
to provide for future needs.
True
True/False
Short-term needs include things
such as home ownership, education
of children and retirement.
False
True/False
Discretionary income is income
you have left to spend after the
bills have been paid.
True
True/False
A regular savings account pays less
interest than a certificate of deposit.
True
True/False
You may be charged a service fee if
you make more than a maximum
number of withdrawals from your
regular savings account in one
month or if your balance falls below
a certain minimum.
True
True/False
Certificates of deposit are less
liquid than regular savings
accounts.
True
True/False
Convenience is a reason why many
people choose a financial institution.
True
True/False
Money market accounts are subject
to early withdrawal penalties.
False
True/False
A money market fund is insured
by the FDIC for a maximum of
$250,000.
False
True/False
Liquidity is a major advantage to
regular savings accounts.
True
True/False
Savings and loan associations
usually offer full checking
account services.
True
True/False
Loan consolidation means
combining all previous student
loans into one large loan.
True
True/False
The law requires all financial
institutions to tell consumers the
annual percentage yield on their
accounts.
True
True/False
Commercial banks offer only a few
banking services and are not
competitive.
False
Money deposited to earn
interest is called _______.
Principal
The date on which a certificate of
deposit is due is called the _______.
Maturity Date
A method to make regular saving
easier is automatic ______
deduction.
Payroll
You will receive the greatest gain on
your principal if interest is
compounded _______.
Daily
If liquidity is important to you, which
of the following savings options
would you not want to consider?
Certificate of Deposit
A savings account at a credit
union is called a _______.
Share Account
Money left over after you have
paid bills is called ________.
Discretionary Income
A stockbroker works for which
type of financial institution?
Brokerage Firm
Which of the following is not a
short-term need?
(A) Unemployment
(B) Weekend Trip
(C) Child’s Education
(D) Automobile Repair
Child’s Education
Which of the following is a condition
determining how much money you
will save?
(A) Amount of discretionary income
(B) Importance of savings
(C) Anticipated wants and needs
(D) All of these
(D) All of these
Which of the following is not a longterm need?
(A) New Car
(B) Home Ownership
(C) Retirement
(D) Investment Plans
(A) New Car
Definition:
When you employer puts your
paycheck into your bank account.
Direct Deposit
Definition:
Money paid for the use of money.
Interest
Definition:
Emergencies, weekend trips, and
social events.
Short-term Need
Definition:
The quality of being easily converted
to cash.
Liquidity
Definition:
Income left over after the bills
have been paid.
Discretionary Income
Definition:
Insurance that covers deposits in
commercial banks.
FDIC
Definition:
The date on which a time
certificate must be renewed or
canceled and a new one purchased.
Maturity
Definition:
A rate that includes compounding.
Annual Percentage Yield
Definition:
Setting aside money to meet
future needs.
Saving
Definition:
The amount of money deposited
by a saver.
Principal
Definition:
Interest paid on the principal
plus interest already earned.
Compound Interest