Vocabulary in Context: Banking and Financial Terms Quiz
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Questions and Answers

What does the term 'amortization period' refer to in the context of a home loan?

  • The period over which the Smiths will pay off their mortgage, including interest (correct)
  • The down payment made on the home
  • The interest rate applied to the loan
  • The credit score required to secure the loan

    • What is the purpose of a down payment in the context of a home purchase?

  • To reduce the amount borrowed and avoid private mortgage insurance (correct)
  • To slowly pay off the loan amount
  • To secure a favorable loan rate
  • To transfer funds between accounts

    • In a mortgage payment, what does the term 'principal' refer to?

  • A portion of the payment that reduces the loan amount (correct)
  • The interest rate applied to the loan
  • The property used as collateral for the loan
  • The credit score required to secure the loan

    • What role does a credit score play in securing a favorable loan rate?

    <p>It indicates a person's ability to make on-time payments and manage debt responsibly</p> Signup and view all the answers

    What type of account did John open to manage his daily expenses and paycheck deposits?

    <p>Chequing Account</p> Signup and view all the answers

    Which account does Maria add money to regularly to earn interest over time?

    <p>Savings Account</p> Signup and view all the answers

    What method did Alex use to pay back his friend for concert tickets, making the transaction quick and easy?

    <p>E-transfer (Electronic Funds Transfer)</p> Signup and view all the answers

    How does Sarah handle her finances without visiting the bank, thanks to its convenience?

    <p>Online Banking</p> Signup and view all the answers

    What did Noah check before traveling to ensure he exchanged his money at a good rate?

    <p>Foreign Exchange Rate</p> Signup and view all the answers

    In order to build her credit history, what did Megan use responsibly, paying off her balance each month?

    <p>Credit Card</p> Signup and view all the answers

    What did Ava decide to do from her savings to her chequing account in order to pay her tuition?

    <p>Transfer Funds</p> Signup and view all the answers

    What does Kevin review monthly to keep track of his spending and account balances?

    <p>Account Summary</p> Signup and view all the answers

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