Wise Practice Test Exam With Verified m m m m m
Solutions m
Which of the following does the Federal Reserve use to regulate the nation's money
m t m t m t m t m t m t m t m t m t m t m t m t m t
supply? (Got Correct)
m
m
t
t
m t m t
Correct Answer : C: Monetary policy - correct answer-Reason : The Federal Reserve m t m t m t m t m t m t m m t t m t m t m t m t m t
uses monetary policy to regulate the nation's money supply. Monetary policy is directed
m t m t m t m t m t m t m t m t m t m t m t m t m t
at expanding or contracting the supply of money and credit in the U.S. economy. In
m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t
theory, if there is too little money in circulation, consumers will spend less, interest rates
m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t
will be high, and unemployment will rise. In this situation, the Fed can deliberately
m t m t m t m t m t m t m t m t m t m t m t m t m t t
m
increase the amount of money in circulation, leading to lower interest rates, increases in
m t m t m t m t m t m t m t m t m t m t m t m t m t m t
consumer spending, and higher employment rates. If there is too much money in
m t m t m t m t m t m t m t m t m t m t t
m m t m t
circulation, however, prices rise and the value of the dollar decreases (inflation)
m t t
m m t m t m t m t t
m m t m t m t m t m t
Purchases made with your debit card are usually: (Correct) m t m t m t m t m t m t m t m t
Correct Answer : A: Deducted immediately from your checking account - correct answer- m t m t m t m t m t m t m t m t m t m t m m t t m t
Reason : Debit card purchases are immediately deducted from your checking account m t m t m t m t m t m t m t m t m t m t m t
balance while credit card purchases are added to your credit card balance. You have
m t m t m t m t m t m t m t m t m t m t m t m t m t m t
about 20 days after receiving a credit card bill to pay it without being charged interest.
m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t
Through the use of a credit card, you get use of goods or services before they are paid
m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t t
m m t
for.
m t
The common name for U.S. currency is: (Correct)
m t m t m t m t m t m t m t
Correct Answer : C: Green backs - correct answer-Reason : The background color of all m t m t m t m t m t m t m m t t m t m t t
m m t m t m t m t
United States currency (bills) is primarily green.
m t m t m t m t m t m t m t
Question 4 : Jami lost her debit card. She did not report it missing for 3 months. If an m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t
unauthorized person used her debit card, her maximum liability is: (Correct)
m t m t t
m m t m t m t m t m t m t m t m t
Correct Answer : C: Unlimited liability - correct answer-Reason : According to the m t m t m t m t t
m m t t t
m m m t m t m t m t m t
Electronic Fund Transfer Act, if a consumer reports the theft or loss of an ATM or debit
m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t
card to the issuing financial institution within two business days, he/she is liable for not
m t m t m t m t t
m m t m t m t m t m t m t m t m t m t m t
more than $50 of unauthorized purchases. If reported within 60 days, the consumer is
m t m t m t m t m t m t m t m t t
m m t m t m t m t m t
liable for up to $500 of unauthorized purchases. If reported after 60 days or not reported,
m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t
the consumer may be liable for the entire amount of unauthorized purchases.
m t m t m t m t m t m t m t m t m t m t m t m t
Question 5 : Identify the background color of a U.S. $5.00 bill. (Correct) m t m t m t m t m t m t m t t
m m t m t m t m t
Correct Answer : C: Green - correct answer-Reason : The background color of all United m t m t m t m t m t m m t t m t m t m t m t m t m t m t m t
States paper currency (bills) is green.
m t m t m t m t m t m t
, Question 6 : Scott just got an ATM card to use and must choose a PIN (Personal m t m t m t m t m t m t t
m m t m t m t m t m t m t m t m t m t
Identification Number). How should he select a PIN that will give him maximum
m t m t m t m t m t m t m t m t m t m t m t m t m t
protection against anyone else being able to find out what the PIN is? (Incorrect)
m t m t m t m t m t m t m t m t m t m t m t m t m t m t
Correct Answer : B: Use a random selection of letters and numbers - correct answer- m t m t m t m t m t m t m t m t m t m t m t m t m m t t m t
Reason : A PIN (personal identification number) is a secret code that protects the privacy m t m t m t m t m t m t m t m t m t m t m t m t m t m t
of your accounts and allows only you to access them. The numbers should not be
m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t
composed of numbers easily associated with the person choosing the PIN such as birth
m t m t m t m t m t m t m t m t m t m t m t m t m t m t
date, telephone number, or street number address. It should be a random series of
m t m t m t m t m t m t m t m t m t m t m t m t m t m t
numbers and letters that would be hard for unauthorized users to guess. Also, never
m t m t m t m t m t m t m t m t m t m t m t t
m m t m t
write your PIN on your ATM or debit card or in your check book because then a thief
m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t
would you?re your confidential information needed to make purchases or withdraw all
m t m t m t m t m t t
m m t m t m t m t m t m t
the money out of your account.
m t t
m m t m t m t m t
Question 7 : A type of electronic funds transfer (EFT) is: (Correct) m t m t m t m t m t m t m t m t m t m t m t
Correct Answer : D: An ATM transaction - correct answer-Reason : According to the m t m t m t m t m t m t m t m m t t m t m t m t m t m t
Electronic Funds Transfer Act, Electronic funds transfers (EFTs) are any transfers of
m t m t m t m t m t m t m t m t m t m t m t m t
funds, other than a transaction originated by check, draft, or other paper instrument,
m t m t m t m t m t m t m t t
m m t m t m t m t m t
initiated through electronic terminal, telephone, or computer, to authorize a financial
m t m t m t m t m t m t m t m t m t m t m t
institution to debit or credit an account. EFT's can be used to carry out many financial
m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t
transactions, for example, to pay utility bills, make installment loan payments, and
m t m t m t m t m t m t m t m t m t t
m m t m t
transfer funds from a savings account to a checking account or vice versa.
m t m t m t m t m t m t m t m t m t m t m t m t m t
Question 8 : A high school student has begun to investigate the field of finance as a m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t
career choice. In deciding about the field, the student should focus on which question
m t m t m t m t m t m t m t m t m t m t m t m t m t m t
first? (Correct)
m t m t
Correct Answer : A: Will I find a balance between financial rewards and personal m t m t m t m t m t m t m t m t m t m t m t m t m t
satisfaction from work? - correct answer-Reason : It is important to investigate a career
m t m t m t m t m m t t m t m t m t m t m t m t t
m m t m t
with the idea of not only getting a sense of earning potential, types of positions available
m t m t m t m t t
m m t m t m t m t m t m t m t m t m t m t m t
and the training necessary to acquire these positions but what are the chances that the
m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t
individual will enjoy working in this field.
m t m t m t m t m t m t m t
Question 9 : m t m t m t
Nora needed to make a long-distance call from a pay phone and did not have the cash.
m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t
She was able to make the call by using her: (Correct)
m t t
m m t m t m t m t m t m t m t m t m t
Correct Answer : C: Cash card - correct answer-Reason : Consumers purchase cash m t m t m t m t m t m t m m t t m t m t m t m t m t
cards for a specific amount of money. The amount paid is stored in the card's memory,
m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t
and the card can be used to pay for goods or services specific to a particular store or
m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t
action until the amount stored, or "loaded" on the card, has been spent. The type of cash
m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t
card Nora used is called a phone card. Some retail chain stores sell cash cards which
m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t
can be used to pay for their products. Cash cards are either disposable or re-loadable.
m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t
Disposable cash cards cannot be replenished (loaded again). With re-loadable cash
m t m t m t m t m t m t m t m t m t m t m t
cards, the consumer can return to the merchant and pay to have the balance on the card
m t m t m t m t m t m t m t m t t
m m t m t m t m t t
m m t m t m t
replenished.
m t
Question 10 : A cash card generally: (Incorrect) m t m t m t m t m t m t m t
Correct Answer : B: Is purchased with a specific amount of money that can be used to pay m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t
for goods or services - correct answer-Reason : Consumers purchase cash cards for a
m t m t m t m t m t m m t t m t m t m t m t m t m t m t m t
specific amount of money. The amount paid is stored in the card's memory, and the card
m t m t m t m t m t m t m t m t m t m t m t t
m m t m t m t m t
Solutions m
Which of the following does the Federal Reserve use to regulate the nation's money
m t m t m t m t m t m t m t m t m t m t m t m t m t
supply? (Got Correct)
m
m
t
t
m t m t
Correct Answer : C: Monetary policy - correct answer-Reason : The Federal Reserve m t m t m t m t m t m t m m t t m t m t m t m t m t
uses monetary policy to regulate the nation's money supply. Monetary policy is directed
m t m t m t m t m t m t m t m t m t m t m t m t m t
at expanding or contracting the supply of money and credit in the U.S. economy. In
m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t
theory, if there is too little money in circulation, consumers will spend less, interest rates
m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t
will be high, and unemployment will rise. In this situation, the Fed can deliberately
m t m t m t m t m t m t m t m t m t m t m t m t m t t
m
increase the amount of money in circulation, leading to lower interest rates, increases in
m t m t m t m t m t m t m t m t m t m t m t m t m t m t
consumer spending, and higher employment rates. If there is too much money in
m t m t m t m t m t m t m t m t m t m t t
m m t m t
circulation, however, prices rise and the value of the dollar decreases (inflation)
m t t
m m t m t m t m t t
m m t m t m t m t m t
Purchases made with your debit card are usually: (Correct) m t m t m t m t m t m t m t m t
Correct Answer : A: Deducted immediately from your checking account - correct answer- m t m t m t m t m t m t m t m t m t m t m m t t m t
Reason : Debit card purchases are immediately deducted from your checking account m t m t m t m t m t m t m t m t m t m t m t
balance while credit card purchases are added to your credit card balance. You have
m t m t m t m t m t m t m t m t m t m t m t m t m t m t
about 20 days after receiving a credit card bill to pay it without being charged interest.
m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t
Through the use of a credit card, you get use of goods or services before they are paid
m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t t
m m t
for.
m t
The common name for U.S. currency is: (Correct)
m t m t m t m t m t m t m t
Correct Answer : C: Green backs - correct answer-Reason : The background color of all m t m t m t m t m t m t m m t t m t m t t
m m t m t m t m t
United States currency (bills) is primarily green.
m t m t m t m t m t m t m t
Question 4 : Jami lost her debit card. She did not report it missing for 3 months. If an m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t
unauthorized person used her debit card, her maximum liability is: (Correct)
m t m t t
m m t m t m t m t m t m t m t m t
Correct Answer : C: Unlimited liability - correct answer-Reason : According to the m t m t m t m t t
m m t t t
m m m t m t m t m t m t
Electronic Fund Transfer Act, if a consumer reports the theft or loss of an ATM or debit
m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t
card to the issuing financial institution within two business days, he/she is liable for not
m t m t m t m t t
m m t m t m t m t m t m t m t m t m t m t
more than $50 of unauthorized purchases. If reported within 60 days, the consumer is
m t m t m t m t m t m t m t m t t
m m t m t m t m t m t
liable for up to $500 of unauthorized purchases. If reported after 60 days or not reported,
m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t
the consumer may be liable for the entire amount of unauthorized purchases.
m t m t m t m t m t m t m t m t m t m t m t m t
Question 5 : Identify the background color of a U.S. $5.00 bill. (Correct) m t m t m t m t m t m t m t t
m m t m t m t m t
Correct Answer : C: Green - correct answer-Reason : The background color of all United m t m t m t m t m t m m t t m t m t m t m t m t m t m t m t
States paper currency (bills) is green.
m t m t m t m t m t m t
, Question 6 : Scott just got an ATM card to use and must choose a PIN (Personal m t m t m t m t m t m t t
m m t m t m t m t m t m t m t m t m t
Identification Number). How should he select a PIN that will give him maximum
m t m t m t m t m t m t m t m t m t m t m t m t m t
protection against anyone else being able to find out what the PIN is? (Incorrect)
m t m t m t m t m t m t m t m t m t m t m t m t m t m t
Correct Answer : B: Use a random selection of letters and numbers - correct answer- m t m t m t m t m t m t m t m t m t m t m t m t m m t t m t
Reason : A PIN (personal identification number) is a secret code that protects the privacy m t m t m t m t m t m t m t m t m t m t m t m t m t m t
of your accounts and allows only you to access them. The numbers should not be
m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t
composed of numbers easily associated with the person choosing the PIN such as birth
m t m t m t m t m t m t m t m t m t m t m t m t m t m t
date, telephone number, or street number address. It should be a random series of
m t m t m t m t m t m t m t m t m t m t m t m t m t m t
numbers and letters that would be hard for unauthorized users to guess. Also, never
m t m t m t m t m t m t m t m t m t m t m t t
m m t m t
write your PIN on your ATM or debit card or in your check book because then a thief
m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t
would you?re your confidential information needed to make purchases or withdraw all
m t m t m t m t m t t
m m t m t m t m t m t m t
the money out of your account.
m t t
m m t m t m t m t
Question 7 : A type of electronic funds transfer (EFT) is: (Correct) m t m t m t m t m t m t m t m t m t m t m t
Correct Answer : D: An ATM transaction - correct answer-Reason : According to the m t m t m t m t m t m t m t m m t t m t m t m t m t m t
Electronic Funds Transfer Act, Electronic funds transfers (EFTs) are any transfers of
m t m t m t m t m t m t m t m t m t m t m t m t
funds, other than a transaction originated by check, draft, or other paper instrument,
m t m t m t m t m t m t m t t
m m t m t m t m t m t
initiated through electronic terminal, telephone, or computer, to authorize a financial
m t m t m t m t m t m t m t m t m t m t m t
institution to debit or credit an account. EFT's can be used to carry out many financial
m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t
transactions, for example, to pay utility bills, make installment loan payments, and
m t m t m t m t m t m t m t m t m t t
m m t m t
transfer funds from a savings account to a checking account or vice versa.
m t m t m t m t m t m t m t m t m t m t m t m t m t
Question 8 : A high school student has begun to investigate the field of finance as a m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t
career choice. In deciding about the field, the student should focus on which question
m t m t m t m t m t m t m t m t m t m t m t m t m t m t
first? (Correct)
m t m t
Correct Answer : A: Will I find a balance between financial rewards and personal m t m t m t m t m t m t m t m t m t m t m t m t m t
satisfaction from work? - correct answer-Reason : It is important to investigate a career
m t m t m t m t m m t t m t m t m t m t m t m t t
m m t m t
with the idea of not only getting a sense of earning potential, types of positions available
m t m t m t m t t
m m t m t m t m t m t m t m t m t m t m t m t
and the training necessary to acquire these positions but what are the chances that the
m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t
individual will enjoy working in this field.
m t m t m t m t m t m t m t
Question 9 : m t m t m t
Nora needed to make a long-distance call from a pay phone and did not have the cash.
m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t
She was able to make the call by using her: (Correct)
m t t
m m t m t m t m t m t m t m t m t m t
Correct Answer : C: Cash card - correct answer-Reason : Consumers purchase cash m t m t m t m t m t m t m m t t m t m t m t m t m t
cards for a specific amount of money. The amount paid is stored in the card's memory,
m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t
and the card can be used to pay for goods or services specific to a particular store or
m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t
action until the amount stored, or "loaded" on the card, has been spent. The type of cash
m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t
card Nora used is called a phone card. Some retail chain stores sell cash cards which
m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t
can be used to pay for their products. Cash cards are either disposable or re-loadable.
m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t
Disposable cash cards cannot be replenished (loaded again). With re-loadable cash
m t m t m t m t m t m t m t m t m t m t m t
cards, the consumer can return to the merchant and pay to have the balance on the card
m t m t m t m t m t m t m t m t t
m m t m t m t m t t
m m t m t m t
replenished.
m t
Question 10 : A cash card generally: (Incorrect) m t m t m t m t m t m t m t
Correct Answer : B: Is purchased with a specific amount of money that can be used to pay m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t m t
for goods or services - correct answer-Reason : Consumers purchase cash cards for a
m t m t m t m t m t m m t t m t m t m t m t m t m t m t m t
specific amount of money. The amount paid is stored in the card's memory, and the card
m t m t m t m t m t m t m t m t m t m t m t t
m m t m t m t m t
