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Understanding Checking and Debit Accounts Answers

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1
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Which option below is not a potential risk of purchasing a used car?

A
used cars can require repairs sooner
B
shorter lifespans of the engine and transmission
C
used cars can have lower initial cost
D
unexpected issues may arise
2
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When companies spend millions of dollars developing logos and slogans, or use celebrity endorsements to encourage consumers to buy particular products, this is called

A
false advertising.
B
undue influence.
C
product branding.
D
quality assurance.
3

A monthly fixed rate mortgage payment

A
could change.
B
never changes.
C
increases annually.
D
decreases annually.
4

Read the scenario.Brad has a steady job, earns a solid income, and plans to live in a nearby city for the long term. He is looking to purchase both a car and a place to live, and he is very interested in building up equity and credit.

A
buying both a car and a home
B
leasing both a car and home
C
buying a car and leasing a home
D
leasing a car and buying a home
5

budgettransportationutilitiesinsurance

A
budget
B
transportation
C
utilities
D
insurance
6

Which statement best describes how an investor makes money off debt?

A
An investor makes money by issuing bonds.
A
An investor makes money by earning interest.
A
An investor makes money by raising capital.
A
An investor makes money by being repaid for the principal.
7

increasesdecreasesstays the same

A
increases
B
decreases
C
stays the same
8

Which investment is best for someone who is likely to need cash soon?

A
mutual fund
B
CD
C
401(k)
D
savings account
9

Which statement best describes stocks?

A
They should be purchased when prices are high and sold when prices are low.
B
They are an investment in a company’s progress and profits.
C
They are a type of investment that includes raw materials and natural resources.
D
They should be purchased only as long-term investments.
10

What is the relationship between risk and return?

A
A higher risk often means a higher return.
B
A lower risk always means a higher return.
C
A higher risk often means a lower return.
D
A lower risk will always mean a lower return.
11

Many checking accounts offer multiple ways of accessing money in addition to checks. Which of these can be used to access money in a checking account?

A
debit card
B
credit card
C
certificate of deposit
D
passbook
12

Which details apply to a financing contract? Check all that apply.

A
requires a credit check
B
are always less expensive than using a credit card
C
includes interest rate information
D
requires a signature for rent-to-own agreements
E
can be broken at any time
13

Alex has not been keeping his banking records up to date. On his latest bank statement, he found that he had been charged an overdraft fee for writing a bad check. In addition to his being charged a fee, which of these is another possible consequence of an overdraft?

A
The bank will close the merchant's account.
B
The merchant who received his check will be charged an overdraft fee.
C
The bank will cancel his debit card.
D
The merchant who received his check will expect repayment and a penalty fee.
14

Which of these is the best reason for Nina to monitor her bank account statements online or on her cell phone app?

A
to know when her bills are due
B
to determine the exact date she can retire
C
to ensure she's paying her fair share in taxes
D
to know how much money she has for budgeting
15

Which questions should someone ask when deciding whether to lease or buy a car? Check all that apply. Will I use it more than the allowed lease mileage?Will my family like the car?How long do I want the car?How much do I want to spend?How much do I like the car’s options?

A
Will I use it more than the allowed lease mileage?
B
Will my family like the car?
C
How long do I want the car?
D
How much do I want to spend?
E
How much do I like the car’s options?
16

Which factors can affect a stock’s price? Check all that apply.

A
market performance
B
the company’s financial health
C
the quantity products produced
D
location of the company
E
the economy
17

Karina keeps excellent records and always knows precisely how much is in her bank account. However, when she receives her bank statement, she’s surprised to see that she has been charged a $5.00 overdraft fee. After reviewing her well-kept records, she cannot find anything that is incorrect. Which would be the best action for Karina to take?

A
Review her records again.
B
Wait for the bank to call her.
C
Ignore the fee because it is relatively small.
D
Check her records against her bank statement.
18

At what point does buying in bulk stop being a wise spending choice?

A
when the consumer has a lot of space to store bulk items
B
when costs rise too quickly due to demand
C
when bulk items are not on sale anymore
D
when the consumer buys more than is needed
19

This chart shows the actual pricing history for three items.

Question illustration
A
game system
B
smartphone
C
DVD
D
It's most beneficial to buy all now.
20

The image shows Alex’s investments in one year. Investments during One Year

Question illustration
A
He should have invested in a commodity instead of a stock.
B
He would have lost more with a higher-risk investment.
C
He most likely would have benefited by diversifying.
D
He most likely would have profited by buying more of the stock.

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