Fool Proof Module 4: Managing Money Answers
C You overdraw your account.
What is the easiest way to ruin your credit with your checking account? A You lose your checkbook, and a thief takes your money. B You don’t use your checking account for four months. C You overdraw your account. D You forget where you put your checkbook.
B You write a check for more money than you have in your account.
Which of the following situations illustrates “overdrawing” your account? A You write a check and forget to sign it. B You write a check for more money than you have in your account. C Your account has $15.00 in it. Your bank charges you a monthly maintenance fee of $10.00. D You make a mistake while you are writing a check, and draw a line through the amount of money.
True
When you fill out a check for a certain amount of money and then sign that check, you are guaranteeing that your account has that much money in it. True False
False
Checks should be written in pencil so that you can easily correct mistakes. True False
D Both A and C.
Look at the following statements. Choose the one correct answer. A Online bill paying can make a lot of sense. B You cannot overdraw your account with online bill paying. C Checking accounts can (and should) be linked to savings accounts. D Both A and C.
True
Money orders are not a good way to pay bills. They are wildly more expensive than writing checks. True False
D All of the above.
Look at the following statements. Choose the one true answer. A Many check cashing services are rip-offs because they charge huge fees. B Check cashing services DO NOT help you build credit. C Most check cashing services are wildly expensive compared to paying bills with a checking account. D All of the above.
A An ATM card allows you to draw money from your checking and/or savings account.
Which of the following statements is true about an ATM card? A An ATM card allows you to draw money from your checking and/or savings account. B You don’t have to have a checking and/or savings account to have an ATM card.
D All of the above.
Which of the following statements are false? A You cannot overdraw your account with an ATM card. B ATM cards can be used in all stores to buy things. C It doesn’t matter what machine you use when you want to draw out money using your ATM card. D All of the above.
C A debit card normally has a MasterCard or Visa logo on it.
Which of the following statements is TRUE? A You borrow money when you use a debit card. B Loaning your debit card to friends is a smart thing to do. C A debit card normally has a MasterCard or Visa logo on it. D No one can use your debit card but you.
A When you pay with a debit or ATM card, you are not borrowing money. You are spending your own money. When you pay with a credit card, you are always borrowing money.
ATM cards and debit cards are much alike. But what is the biggest difference between an ATM card or debit card, and a credit card? Choose the one right answer. A When you pay with a debit or ATM card, you are not borrowing money. You are spending your own money. When you pay with a credit card, you are always borrowing money. B When you pay with a debit or ATM card, you borrow money from a company. C When you pay with a credit card, the money you are spending comes straight out of your own account. D When you pay with a debit card you must pay back the money you spent and must pay interest.
B You deposit a check in your checking account, and the teller tells you the money will be available in five days.
Which statement best describes putting a “hold” on a check? A You deposit a check in your checking account, and the teller tells you the money will clear tomorrow. B You deposit a check in your checking account, and the teller tells you the money will be available in five days. C The bank teller holds the check until the person who wrote the check goes to the bank. D The teller keeps your check in the cash drawer for a few days.
B No.
You have $400 in your checking account, and deposit a check for $700. The teller says that the $700 check is on hold for five days. Tomorrow, you want to pay a $600 bill with a check. Should you write that check? A Yes. B No. C Not sure. D I was absent the day they taught that in math.
B $400.
You have $500 in your account. You are very responsible. What is the maximum amount of money you should spend? A $499. B $400. C $500. D $525.
D All of the above.
What should you do when you open a checking account? A Open a savings account at the same time you open your checking account. B Link your checking account to your savings account. C Try to sign up for true overdraft protection, even though you have to pay for it. D All of the above.
True
It’s stupid to trust an ATM machine to tell you your checking account balance. True False
B The balance you see on the ATM machine or online may not include payments that haven’t yet been deducted from your balance.
It is stupid to trust an ATM machine to tell you the correct balance in your account. Why? A The machine could be broken. B The balance you see on the ATM machine or online may not include payments that haven’t yet been deducted from your balance.
True
Some financial institutions can be really bad about putting unexpected charges on your checking account. True False
A You never know when unexpected fees or expenses will hit your checking account. And you can at times forget to write down a payment you make with your checking account or debit/ATM card. So, you’re less likely to overdraw your account if you always keep a hundred dollar balance.
Why would a smart person keep at least a $100 balance in their checking account at all times? Which answer is MOST correct? A You never know when unexpected fees or expenses will hit your checking account. And you can at times forget to write down a payment you make with your checking account or debit/ATM card. So, you’re less likely to overdraw your account if you always keep a hundred dollar balance. B It can impress your friends to show them you always keep money in your account, and you should always show your friends your account. C You can earn more interest if you keep at least $100 in your checking account. D All banks give you bonus gifts if you have at least $100 in your checking account.
D Your financial institution will charge you an “overdraft fee” every time you overdraw your account, and will probably tell the credit bureaus you have overdrawn your account. The credit bureau might lower your credit rating. If the credit bureaus lower your credit rating, you get charged more on interest for loans and credit cards, and you may have to pay bigger deposits for utilities.
You don’t keep a $100 balance in your checking account, and you overdraw your account a few times. Which of these is the most likely result? A Your financial institution will charge you an “overdraft fee” every time you overdraw your account, and won’t do anything else. B Your financial institution will charge you an “overdraft fee” every time you overdraw your account, and will tell the credit bureaus you have overdrawn your account several times. C Your financial institution will charge you an “overdraft fee” every time you overdraw your account, and will tell the credit bureaus you have overdrawn your account. The credit bureau might lower your credit rating, but nothing else happens. D Your financial institution will charge you an “overdraft fee” every time you overdraw your account, and will probably tell the credit bureaus you have overdrawn your account. The credit bureau might lower your credit rating. If the credit bureaus lower your credit rating, you get charged more on interest for loans and credit cards, and you may have to pay bigger deposits for utilities.
C Cancel your credit card ASAP.
If you use mobile payment and you lose your phone, you should: A Just start using your credit card instead. B Get a new phone and keep using the same card in the app. C Cancel your credit card ASAP. D Get someone else to pay for everything.
A You never know when unexpected fees or expenses will hit your checking account. And you can at times forget to write down a payment you make with your checking account or debit/ATM card. So, you’re less likely to overdraw your account if you always keep a hundred dollar balance.
Why would a smart person keep at least a $100 balance in their checking account at all times? Which answer is MOST correct? A You never know when unexpected fees or expenses will hit your checking account. And you can at times forget to write down a payment you make with your checking account or debit/ATM card. So, you’re less likely to overdraw your account if you always keep a hundred dollar balance. B It can impress your friends to show them you always keep money in your account, and you should always show your friends your account. C You can earn more interest if you keep at least $100 in your checking account. D All banks give you bonus gifts if you have at least $100 in your checking account
C Because the check is large and the bank wants to make sure it gets the money before releasing it to you.
Why do banks put a “hold” on a check? A Because you look shady and they do not trust you. B Because the check is written for a future date. C Because the check is large and the bank wants to make sure it gets the money before releasing it to you. D Because the bank does not have enough money on hand to give you your cash.
B No.
If you deposit a check into your account and the teller tells you it is on hold for five days, can you still spend that money today or tomorrow? A Yes. B No. C Not sure. D Yes, if I write a check.
A A debit card never has a MasterCard or Visa logo on it.
Which of the following statements is false? A A debit card never has a MasterCard or Visa logo on it. B Your debit card is like cash. C You do not borrow money when you use a debit card. D Loaning your debit card to friends is a not smart thing to do.
D Both A and C.
What should you do when you open a checking account? A Open a savings account and link it to your checking account. B Try to get a car loan. C Try to sign up for true overdraft protection, even though you have to pay for it. D Both A and C.
B The balance on the machine may not include payments you have made by check or online that need to be deducted from your balance.
Why is it stupid to trust an ATM machine to tell you your correct balance? A The machine could be broken. B The balance on the machine may not include payments you have made by check or online that need to be deducted from your balance.
A Overdraw.
What is it called when you write a check for more money than you have in your account? A Overdraw. B Overpay. C Interest rate. D ATM Fee.
True
Online bill pay is much easier and cheaper than writing checks to pay your bills. True False
A You can overdraw your account with an ATM card.
Which one of the following statements is true? A You can overdraw your account with an ATM card. B ATM cards can be used in all stores to buy things. C It doesn’t matter what machine you use when you want to draw out money using your ATM card. D All of the above.
C You overdraw your account many times and the bank closes your account.
You are just starting out building your credit. What is the easiest way to ruin your credit with your checking account? A You lose your checkbook, and a thief takes your money. B You don’t use your checking account for four months. C You overdraw your account many times and the bank closes your account. D You forget where you put your checkbook.
D An ATM will always give you money no matter how much money you have in your account.
Which of the following statements about an ATM card is false? A An ATM card allows you to draw money from your checking and/or savings account. B When you use some ATM machines you will probably have to pay an additional fee. C ATM cards can be used at most gas stations. D An ATM will always give you money no matter how much money you have in your account.
True
When you pay with a debit or ATM card, you are not borrowing money. You are spending your own money. When you pay with a credit card, you are always borrowing money. True False
C Checking accounts can (and should) be linked to a savings account.
Look at the following statements. Choose the correct answer. A Online bill paying does not make any sense. B You can’t overdraw your account with online bill paying. C Checking accounts can (and should) be linked to a savings account. D Checking accounts should never be linked to savings accounts.
D $100.
You have $200 in your account. You are very responsible. What is the maximum amount of money you should spend? A $199. B $225. C $200. D $100.
A Many check cashing services are rip-offs because they charge huge fees.
Look at the following statements. Choose the one true answer. A Many check cashing services are rip-offs because they charge huge fees. B Check cashing services can help you build credit. C Most check cashing services are a cheaper alternative compared to paying bills with a checking account. D All of the above.
True
Some financial institutions like to charge you for checks, check registries, ATM fees and change sorting fees. True False
False
It is OK to use “white-out” to fix a mistake when writing checks in pen. True False
D Your financial institution will charge you an “overdraft fee” every time you overdraw your account, and may tell the credit bureaus you have overdrawn your account. The credit bureau might then lower your credit rating. If the credit bureaus lower your credit rating, you get charged more on interest for loans and credit cards, and you may pay bigger deposits for utilities.
You don’t keep a $100 balance in your checking account, and you overdraw your account a few times. Which of these is the most likely result? A Your financial institution will charge you an “overdraft fee” every time you overdraw your account, and won’t do anything else. B Your financial institution will charge you an “overdraft fee” every time you overdraw your account, and will probably tell the credit bureaus you have overdrawn your account several times. C Your financial institution will charge you an “overdraft fee” every time you overdraw your account, and will tell the credit bureaus you have overdrawn your account. The credit bureau might lower your credit rating, but nothing else happens. D Your financial institution will charge you an “overdraft fee” every time you overdraw your account, and may tell the credit bureaus you have overdrawn your account. The credit bureau might then lower your credit rating. If the credit bureaus lower your credit rating, you get charged more on interest for loans and credit cards, and you may pay bigger deposits for utilities.
False
When you fill out a check for a certain amount of money and then sign that check, you are saying you might have money in that account. True False
True
The best way to get an accurate checking account balance is to call your bank or credit union directly. True False
B Get a new phone and keep using the same card in the app.
If you use mobile payment and lose your phone, you should NOT: A Cancel your card. B Get a new phone and keep using the same card in the app. C Remotely lock your device. D If possible, clear the data off of your device.
Which of the following statements is true about an ATM card?
An ATM card allows you to draw money from your checking and/or savings account.
Which of the following statements is TRUE?
(//Got this wrong. Best guess: A debit card normally has a MasterCard or Visa logo on it.)
If you use mobile payment and you lose your phone, you should:
Cancel your credit card ASAP.
Which statement best describes putting a “hold” on a check?
You deposit a check in your checking account, and the teller tells you the money will be available in five days.
Why would a smart person keep at least a $100 balance in their checking account at all times? Which answer is MOST correct?
You never know when unexpected fees or expenses will hit your checking account. And you can at times forget to write down a payment you make with your checking account or debit/ATM card. So, you’re less likely to overdraw your account if you always keep a hundred dollar balance.
Which of the following statements are false?
All of the above. (You cannot overdraw your account with an ATM card. / ATM cards can be used in all stores to buy things. / It doesn’t matter what machine you use when you want to draw out more using your ATM card.)
Checks should be written in pencil so that you can easily correct mistakes.
False.
Some financial institutions can be really bad about putting unexpected charges on your checking account.
True.
What should you do when you open a checking account?
All of the above. (Open a savings account at the same time you open your checking account. / Link your checking account to your savings account. / Try to sign up for true overdraft protection, even though you have to pay for it.)
Money orders are not a good way to pay bills. They are wildly more expensive than writing checks.
True.
It’s stupid to trust an ATM machine to tell you your checking account balance.
True.
Look at the following statements. Choose the one true answer.
All of the above. (Many check cashing services are rip-offs because the charge huge fees. / Check cashing services DO NOT help you build credit. / Most check cashing services are wildly expensive compared to paying bills with a checking account.)
ATM cards and debit cards are much alike. But what is the biggest difference between an ATM card or debit card, and a credit card? Choose the one right answer.
When you pay with a debit card or ATM card, you are not borrowing money. You are spending your own money. When you pay with a credit card, you are always borrowing money.
You have $400 in your checking account, and deposit a check for $700. The teller says that the $700 check is on hold for five days. Tomorrow, you want to pay a $600 bill with a check. Should you write that check?
No.
You have $500 dollars in your account. You are very responsible. What is the maximum amount of money you should spend?
$400.
When you fill out a check for a certain amount of money and then sign that check you are guaranteeing that your account has that much money in it.
True.
Look at the following statements. Choose the one correct answer.
Both A and C. (Online bill paying can make a lot of sense. / Checking accounts can (and should) be linked to savings accounts.)
What is the easiest way to ruin your credit with your checking account?
You overdraw your account.
it is stupid to trust an ATM machine to tell you the correct balance in your account. Why?
The balance you see on the ATM machine or online may not include payments that haven’t yet been deducted from your balance.
You don’t keep a $100 balance in your checking account, and you overdraw you account a few times. Which of these is the most likely result?
(//It’s like the longest answer there.) Your financial institution will charge you an “overdraft fee” every time you overdraw your account, and will probably tell the credit bureaus you have overdrawn your account. The credit bureau might lower your credit rating. If the credit bureaus lower your credit rating, you get charged more on interest for loans and credit cards, and you may have to pay bigger deposits for utilities.
Which of the following situations illustrates “overdrawing” your account?
You write a check for more money than you have in your account.
Related Test Answers: FoolProof Module 5 Test Answers
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