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Banking Wise Practice Test Questions-Solved 2024
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Banking Wise Practice Test Questions-Solved 2024
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Banking Wise Practice Test Questions-Solved 2024
A bank Certificate of Deposit is a: - ANSWER-Savings instrument that requires a
deposit for a period of time during which there is a penalty for withdrawals - A certificate
of deposit (CD) is a savings instrument that requires a deposit for a period of time (term)
during which the saver cannot withdraw money from the plan without a penalty. CDs are
issued with terms from 31 days up to eight years. The longer the consumer agrees to
loan the money to the bank or credit union, generally the higher the interest rate. It is
considered a form of savings because the consumer is paid interest based on the dollar
amount and term of the CD. If the consumer does not collect his/her money at the end
of the term, the money may be rolled over into another CD.
A blank endorsement on a check - ANSWER-Creates a check that can be cashed by
anyone - A blank endorsement is your signature only and is like cash. Anyone who
holds the check can present it for payment at a bank or credit union. Therefore, a blank
endorsement should not be used unless you are in the financial institution when you
endorse the check. Some banks and credit unions are asking for a picture ID before
they will cash a check
A good practice when using credit cards is to routinely - ANSWER-pay the complete
balance each month- Credit card companies charge considerable interest for not paying
the complete balance each month. Therefore having a monthly balance shows the
person is spending more money (charging) than the person can afford and therefore the
individual is not a good money manager
A person has three credit cards with very large outstanding balances and is unable to
make payments on any of them. Which action should the person take? - ANSWER-
Notify the credit card companies in order to negotiate a new payment plan- When
experiencing financial difficulties, the first action to take is to notify creditors, in this case
the three credit card companies. Quite often the company will assist in negotiating new
terms.
Banks use savings account deposits to - ANSWER-Give loans to consumers and
businesses - The basic functions of banks and credit unions are to be an intermediary
between savers and borrowers. Banks and credit unions pay interest on customers'
savings accounts and hold customers' money through checking accounts and then lend
most of that money to other consumers and businesses for a fee (interest).
Consumers who file for bankruptcy are still responsible for - ANSWER-Tax claims and
student loans - Types of debts that are not discharged by a bankruptcy include some
tax claims, alimony, child support, most student loans, claims for punitive damages for
malicious or reckless acts such as driving under the influence (DUI), and state and
federal income taxes.
, Debbie was behind on her stereo installment credit contract payments. As a result, the
creditor seized and sold the stereo. The sale price did not cover all of the loan balance,
the creditor got a court to order her employer to withhold part of her wages. This court
order is called - ANSWER-Garnishment - A garnishment is a court order requiring an
employer to pay part of an employee's wages to the creditor.
Doug wants to buy a car in two months, but does not have enough money. What is the
best way for Doug to get the money he needs? - ANSWER-Take out a cash loan - In
order to get the money now, he could borrow the money by getting a car loan from an
automobile dealer, bank, or credit union. Some people borrow money from family
members or friends to buy a car or for the down payment on a car loan
How can you protect yourself against credit card fraud? - ANSWER-Be extremely
careful about disclosing account information to unsolicited callers.- Preventive
measures are always the best safeguard. Potential credit issuers need to know some
personal information in order to learn about your credit history and determine your
credit-worthiness. Information is power; keep yours secure, and give it out only when
you make the call.
If a person makes a deposit of $10,000 or more into a bank account, the bank must
notify the - ANSWER-US Treasury Department- 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
If you are denied credit based on your credit report, you are entitled to a: - ANSWER-
Free copy of the credit report if you request it within 60 days - If requested within 60
days after the denial, you must be provided with a free copy of the credit report from the
specific credit reporting agency whose report was the basis for credit, employment,
insurance, or housing denial. At all other times, there is a small fee to get a credit report.
Joan wants to open a checking account and wonders if checking accounts pay interest.
How would you answer her question? - ANSWER-Some types of checking accounts
pay interest - 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
Margaret wants to store a valuable coin collection and important papers. Generally,
consumers should - ANSWER-Rent a safe deposit box for their valuables - Bank
customers can rent safe deposit boxes from the bank. They are metal boxes kept in the
bank vault where customers often keep valuable papers, financial records, jewelry, and
collections
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