Everfi Module 1 Quiz
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Questions and Answers

Which of the following is NOT a common feature of a financial institution?

  • Access to investment products
  • Investment trading
  • Access to investment advice
  • None of the above (correct)

    • Which of the following statements about check cashing companies is TRUE?

    True

    Which of the following financial institutions typically have the highest fees?

  • Savings institutions
  • Check cashing and payday loan companies (correct)
  • Banks
  • Credit unions

    • Which of the following statements about check cashing companies is FALSE?

    <p>True</p> Signup and view all the answers

    Which type of bank account typically offers the least (if any) interest?

    <p>Checking account</p> Signup and view all the answers

    Savings accounts typically offer more interest than what type of account?

    <p>Checking account</p> Signup and view all the answers

    Which type of bank account is best for everyday transactions?

    <p>Checking account</p> Signup and view all the answers

    A savings account that compounds interest daily will earn a higher return than a savings account that pays simple interest daily.

    <p>True</p> Signup and view all the answers

    Which savings account will earn you the least money?

    <p>One that pays simple interest monthly</p> Signup and view all the answers

    Which savings account will earn you the most money?

    <p>One that compounds interest daily</p> Signup and view all the answers

    Why is it important to reconcile your bank statements?

    <p>To avoid spending more than what is in your account, to detect any errors in your account, and to determine if you were charged any fees.</p> Signup and view all the answers

    How can you avoid spending more than what is in your bank account?

    <p>Keep your own records to compare with your financial institution's records.</p> Signup and view all the answers

    How would you reconcile your bank account to avoid spending more than you have?

    <p>Compare your own records of your spending with your financial institution's records.</p> Signup and view all the answers

    What should you do before you withdraw money from the ATM?

    <p>Inspect the ATM to make sure it wasn't tampered with.</p> Signup and view all the answers

    What should you do before you approach an ATM?

    <p>Check for any suspicious people lurking nearby.</p> Signup and view all the answers

    What should you do before you use an ATM?

    <p>Inspect the ATM and its surroundings to make sure it is safe to use.</p> Signup and view all the answers

    Which of the following statements about savings accounts is FALSE?

    <p>True</p> Signup and view all the answers

    Which of the following statements about savings accounts is FALSE?

    <p>True</p> Signup and view all the answers

    Which of the following statements is TRUE?

    <p>True</p> Signup and view all the answers

    If there is a mistake on one of your bank accounts, who should you contact to resolve the issue?

    <p>Your financial institution</p> Signup and view all the answers

    If there is an issue with your bank statement or account balance, who should you contact to resolve the issue?

    <p>Your bank</p> Signup and view all the answers

    Your financial institution can't help you if there is a mistake on your bank account statement.

    <p>False</p> Signup and view all the answers

    Which of the following statements about investing is TRUE?

    <p>True</p> Signup and view all the answers

    Investing is best for...

    <p>Long term financial goals like paying for retirement</p> Signup and view all the answers

    Which of the following statements about investing is FALSE?

    <p>True</p> Signup and view all the answers

    A stock is...

    <p>A share of ownership in a company</p> Signup and view all the answers

    A mutual fund is...

    <p>A type of investment that invests in a mix of different types of investments</p> Signup and view all the answers

    Which of the following statements about stocks is TRUE?

    <p>True</p> Signup and view all the answers

    Paying only the minimum balance on your credit card can lead to...

    <p>Paying more interest</p> Signup and view all the answers

    Study Notes

    Financial Institutions

    • Common features of financial institutions include investment products, trading, and advice.

    Check Cashing Companies

    • Check cashing companies are known for charging high fees.
    • They do not charge low fees, contrary to some misconceptions.

    Types of Bank Accounts

    • Checking accounts typically offer little to no interest.
    • Savings accounts usually provide more interest compared to checking accounts.
    • Checking accounts are the best option for everyday transactions.

    Interest on Savings Accounts

    • Savings accounts that compound interest daily yield higher returns than those with simple interest.
    • Accounts earning simple interest monthly will generate the least income.

    Importance of Reconciliation

    • Reconciling bank statements is crucial to prevent overspending, detect errors, and identify fees charged.

    Managing Bank Account Spending

    • Maintain personal records to compare with financial institution statements and avoid exceeding account limits.

    ATM Safety

    • Inspect ATMs for tampering and check surroundings for suspicious individuals before use.

    Savings Account Regulations

    • It is false that savings accounts allow unlimited withdrawals monthly or that they typically don't require a minimum balance.

    Addressing Bank Errors

    • Report any mistakes on bank accounts to the financial institution promptly for resolution.

    Investing Basics

    • Investing is inherently riskier than savings account deposits.
    • Ideal for long-term financial goals, such as retirement funding.
    • It is a misconception that investing guarantees money growth.

    Investment Types

    • Stocks represent ownership in a company.
    • Mutual funds consist of a diversified mix of investments.

    Credit Card Management

    • Paying only the minimum balance on a credit card increases interest costs.

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    Description

    Test your knowledge with this quiz on financial institutions covered in Everfi Module 1. Questions include topics like investment products, check cashing companies, and fees associated with different financial institutions. Perfect for reinforcing your understanding of financial literacy concepts.

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