Test Your KnowledgeLesson 2: In the Aftermath

Click on the letter of your choice to test your

understanding.

A B C

Question 1

A deposit account that offers easy access to your money, offers the option to pay bills online or by electronic transfer, and offers the option to make purchases with an ATM or debit card is called:

• A checking accountA• A savings accountB• A money market

accountC

Question 2A deposit account that pays interest on deposits, allows withdrawals and transfers with an ATM card, does not offer the option of bill payment or purchases, and may have a minimum deposit requirement is called

• A money market accountA• A savings accountB• A certificate of depositC

Question 3A deposit account that requires deposited funds to remain in the account for a fixed amount of time, imposes penalty fees for early withdrawal, and generally pays higher interest rates than other deposit accounts is called:

• A savings accountA• A certificate of depositB• A money market

accountC

Question 4A deposit account that pays higher interest on deposits than other accounts, generally has a minimum balance requirement, and allows a very limited number of transactions each month is called:

• A checking accountA• A money market accountB• A certificate of depositC

Question 5Examples of traditional financial institutions include:

• Commercial banks and credit unionsA

• Commercial banks and finance companiesB

• Payday lenders and check-cashing outletsC

Question 6Which of the following items is a potential negative consequence of placing money in a certificate of deposit?

• Earns lower interest than a savings accountA

• Has a limited number of monthly transactionsB

• Penalties are charged for early withdrawals of fundsC

Question 7When choosing a financial institution, you should consider:

• Access to locations, ATMs, and services to meet your financial needs

A• Fees charged for

overdrafts and other penaltiesB

• The likelihood of the bank failingC

Question 8A check:

• Directs your financial institution to transfer money from your account to another person’s or business’s account.

A• Can be converted to an electronic

debit by the recipient by using the digits in the MICR line.B

• Both of the aboveC

Question 9An overdraft occurs:

• When you write more than the allowed number of checks during a single month.A

• When your savings account balance falls below the minimum amount required by the rules of the account.

B• When a check is cashed or a debit is

processed against an account that does not have sufficient funds to cover the transaction.

C

Question 10Direct deposit:

• Is available only to customers with checking accounts.A

• Can be accomplished by transferring funds from your savings to your checking account using an ATM.B

• Is a convenience that allows recipients of a direct deposit to have same-day access to deposited funds.

C

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Knowledge”