Wise Practice Test Questions with complete solution 2024/2025
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Course
WISE
Institution
WISE
Wise Practice Test Questions with complete solution 2024/2025 Wise Practice Test-Difficult
If a person makes a deposit of $10,000 or more into a bank account, the bank must notify the - correct answer A: US Treasury Department.
Reason: In order to track large deposits, the federal governm...
Wise Practice Test-Difficult
If a person makes a deposit of $10,000 or more into a bank account, the bank
must notify the - correct answer ✔A: US Treasury Department.
Reason: In order to track large deposits, the federal government requires that
deposits of $10,000 or more be reported to the Treasury Department. Some
concerns may be that a person might be trying to avoid paying taxes on game
winnings or perhaps illegal gains.
Which financial product can you buy for $25, is safe, and will be worth $50 at
a future date? - correct answer ✔A: Series EE savings bond
Reason: Series EE savings bonds, which are issued and backed by the U.S.
Treasury, are purchased for one-half of their face value. These bonds earn
interest monthly, and a $50 Series EE bond, which is purchased for $25, is
guaranteed to reach face value within 17 years, and may reach face value
sooner.
Joan wants to open a checking account and wonders if checking accounts
pay interest. How would you answer her question? - correct answer ✔B:
Some types of checking accounts pay interest
Reason: Regular checking accounts do not earn interest. NOW (negotiable
order of withdrawal) accounts do earn interest but tend to have higher
minimum balance requirements than regular checking accounts and often limit
the number of checks that can be written each month without a fee.
Which financial product has the most predictable income? - correct answer
✔C: Certificate of deposit
, Reason: Most certificates of deposit (CDs) are issued with an interest rate that
is fixed at a specified rate for the entire term of the deposit. The main virtue of
a fixed-rate CD is its predictability. The investor knows exactly how much
interest will be received annually and over the life of the CD.
Consumer finance companies, which are often advertised on TV, are also
known as: - correct answer ✔C: Small loan companies
Reason: Consumer finance companies specialize in making small loans to
individuals or businesses. They primarily make loans to people who cannot
qualify for credit elsewhere because of a poor credit history, low income, or
minimal assets. For these reasons, interest rates are usually higher than loans
from a bank or credit union.
When a person declares bankruptcy that fact will appear on the person's
credit report - correct answer ✔B: for a 10 year period.
Reason: Most of the adverse information on a credit report appears for 7
years. After a \ndeclared bankruptcy, the limit is 10 years.
Which of the following is considered to be open-end credit? - correct answer
✔C: Department store charge cards.
Reason: Open-end credit is a revolving live of credit that is offered by banks
and other lenders to consumers. There is a limit set on the line of credit and
the funds, products or services are accessed using a credit or debit card,
check, store charge card or cash advance. Consumers pay interest on the
outstanding balance. A car loan is made for a specified amount and a specific
length of time and is therefore considered closed-end credit. A mortgage loan
is also considered a form of closed-end credit since the house serves as
collateral for the loan which is made at a specified interest rate for a specified
time period.
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