Wise Practice Test Exam With Verified Solutions.

Wise Practice Test Exam With Verified v v v v v




Solutions v




Which of the following does the Federal Reserve use to regulate the nation's money
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supply? (Got Correct)
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Correct Answer : C: Monetary policy - correct answer-Reason : The Federal Reserve
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uses monetary policy to regulate the nation's money supply. Monetary policy is directed
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at expanding or contracting the supply of money and credit in the U.S. economy. In
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theory, if there is too little money in circulation, consumers will spend less, interest rates
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will be high, and unemployment will rise. In this situation, the Fed can deliberately
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increase the amount of money in circulation, leading to lower interest rates, increases in
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consumer spending, and higher employment rates. If there is too much money in
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circulation, however, prices rise and the value of the dollar decreases (inflation)
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Purchases made with your debit card are usually: (Correct) vt vt vt vt vt vt vt vt




Correct Answer : A: Deducted immediately from your checking account - correct
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answer-Reason : Debit card purchases are immediately deducted from your checking
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account balance while credit card purchases are added to your credit card balance.
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You have about 20 days after receiving a credit card bill to pay it without being charged
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interest. Through the use of a credit card, you get use of goods or services before they
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are paid for.
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The common name for U.S. currency is: (Correct)
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Correct Answer : C: Green backs - correct answer-Reason : The background color of all
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United States currency (bills) is primarily green.
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Question 4 : Jami lost her debit card. She did not report it missing for 3 months. If an
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unauthorized person used her debit card, her maximum liability is: (Correct)
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Correct Answer : C: Unlimited liability - correct answer-Reason : According to the
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Electronic Fund Transfer Act, if a consumer reports the theft or loss of an ATM or debit
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card to the issuing financial institution within two business days, he/she is liable for not
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more than $50 of unauthorized purchases. If reported within 60 days, the consumer is
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, vt liable for up to $500 of unauthorized purchases. If reported after 60 days or not
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vt reported, the consumer may be liable for the entire amount of unauthorized purchases.
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Question 5 : Identify the background color of a U.S. $5.00 bill. (Correct)vt vt vt vt vt vt vt vt vt vt vt vt




Correct Answer : C: Green - correct answer-Reason : The background color of all
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United States paper currency (bills) is green.
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Question 6 : Scott just got an ATM card to use and must choose a PIN (Personal
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Identification Number). How should he select a PIN that will give him maximum
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protection against anyone else being able to find out what the PIN is? (Incorrect)
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Correct Answer : B: Use a random selection of letters and numbers - correct answer-
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Reason : A PIN (personal identification number) is a secret code that protects the
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privacy of your accounts and allows only you to access them. The numbers should not
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be composed of numbers easily associated with the person choosing the PIN such as
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birth date, telephone number, or street number address. It should be a random series of
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numbers and letters that would be hard for unauthorized users to guess. Also, never
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write your PIN on your ATM or debit card or in your check book because then a thief
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would you?re your confidential information needed to make purchases or withdraw all
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the money out of your account.
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Question 7 : A type of electronic funds transfer (EFT) is: (Correct) vt vt vt vt vt vt vt vt vt vt vt




Correct Answer : D: An ATM transaction - correct answer-Reason : According to the
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Electronic Funds Transfer Act, Electronic funds transfers (EFTs) are any transfers of
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funds, other than a transaction originated by check, draft, or other paper instrument,
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initiated through electronic terminal, telephone, or computer, to authorize a financial
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institution to debit or credit an account. EFT's can be used to carry out many financial
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transactions, for example, to pay utility bills, make installment loan payments, and
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transfer funds from a savings account to a checking account or vice versa.
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Question 8 : A high school student has begun to investigate the field of finance as a
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career choice. In deciding about the field, the student should focus on which question
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first? (Correct)
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Correct Answer : A: Will I find a balance between financial rewards and personal
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satisfaction from work? - correct answer-Reason : It is important to investigate a career
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with the idea of not only getting a sense of earning potential, types of positions available
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and the training necessary to acquire these positions but what are the chances that the
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individual will enjoy working in this field.
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Question 9 : vt vt vt




Nora needed to make a long-distance call from a pay phone and did not have the cash.
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She was able to make the call by using her: (Correct)
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Correct Answer : C: Cash card - correct answer-Reason : Consumers purchase cash
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cards for a specific amount of money. The amount paid is stored in the card's memory,
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and the card can be used to pay for goods or services specific to a particular store or
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action until the amount stored, or "loaded" on the card, has been spent. The type of
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cash card Nora used is called a phone card. Some retail chain stores sell cash cards
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which can be used to pay for their products. Cash cards are either disposable or re-
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loadable. Disposable cash cards cannot be replenished (loaded again). With re-
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