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Exam - Makeup

True/False
Indicate whether the statement is true or false.
 

 1. 

Banks will hold postdated checks and process them at the future date.
 

 2. 

It is desirable to keep the number of credit cards you have to a maximum.
 

 3. 

U.S. savings bonds are insured by the FDIC.
 

 4. 

Consumers have the right to one free copy of their credit reports annually.
 

 5. 

By insuring deposits in banks, the FDIC helps to promote public confidence in the U.S. financial system.
 

 6. 

If you order your credit report online, you can have access to it within minutes.
 

 7. 

It is unlawful for a debt collector to call you at your place of work.
 

 8. 

While a billed amount is in dispute, the creditor cannot charge interest on that amount.
 

 9. 

If you’ve already been preapproved for a car loan through your bank, you should not consider the finance offer presented to you by the car dealer.
 

 10. 

The Fair Credit Billing Act requires credit card companies to have billing error policies and inform their customers how to report errors.
 

 11. 

Tips given to a person for performing a service are not subject to federal income taxes.
 

 12. 

A checking account is also called a demand deposit account because the account holder may withdraw money on demand or write checks on the account at any time.
 

 13. 

You should establish and maintain an amount of unused credit available for use in emergencies.
 

 14. 

With all forms of bankruptcy, the debtor has an automatic stay, which provides immediate protection from any further action by creditors.
 

 15. 

Salaried workers usually do not keep time cards or count hours worked and do not receive overtime pay.
 

 16. 

A depositor may double the amount his or her funds are insured by the FDIC by placing the maximum insurable amount in each of two banks.
 

 17. 

Bankruptcy stays on a persons credit record for up to 14 years.
 

 18. 

The Bankruptcy Abuse Prevention and Consumer Protection Act (BAPCPA) of 2005 made it easier for consumers to file Chapter 7 bankruptcy.
 

 19. 

An unsecured loan must be backed by collateral.
 

 20. 

Chapter 17 bankruptcy is intended for business owners.
 

 21. 

It is illegal for a telemarketer to ask for an upfront fee in order for you to claim a prize.
 

 22. 

When you are notified that the interest rate on your credit card is going up, you must either accept the change or cancel the card.
 

 23. 

One purpose of bankruptcy law is to ensure fair treatment for creditors.
 

 24. 

A consumer has 90 days from the day a bill is received to file a dispute.
 

 25. 

Debit cards carry all the same protections provided with credit cards.
 

 26. 

If a credit card company charges an annual fee, it will be charged regardless of whether the cardholder has used the card or carried a balance on it in the last year.
 

 27. 

Debt represents future earnings already spent.
 

 28. 

When you purchase a savings bond, you are loaning money to the government.
 

 29. 

Long-term debt is a loan that is payable over a period longer than a year.
 

 30. 

You should complete the register entry for a check before writing the check.
 

 31. 

Gambling winnings are subject to income tax but not social security tax.
 

Multiple Choice
Identify the choice that best completes the statement or answers the question.
 

 32. 

The following are examples of pay without work except
a.
vacation pay
c.
sick pay
b.
profit sharing
d.
personal leave
 

 33. 

When a paper check is transformed into a digital image, it is said to be
a.
canceled
c.
truncated
b.
restricted
d.
transposed
 

 34. 

Which of the following types of lenders generally extends legal high-interest loans to consumers who may be ineligible for other types of low-interest loans?
a.
sales finance company
c.
mortgage company
b.
consumer finance company
d.
loan shark
 

 35. 

Which of the following is not a demand deposit in a bank?
a.
checking account
c.
money market account
b.
savings account
d.
certificate of deposit
 

 36. 

The Truth-in-Lending Act requires which of the following to be put in writing before a loan or credit agreement is signed?
a.
any service fees or other costs added to the price
b.
the annual percentage rate
c.
the total finance charge and method of computing it
d.
all of these
 

 37. 

Which of the following levels of alternative dispute resolution (ADR) does not require a neutral third party?
a.
negotiation
c.
arbitration
b.
mediation
d.
litigation
 

 38. 

Under which type of bankruptcy is all (for an individual or company) debt erased?
a.
Chapter 7 bankruptcy
c.
Chapter 13 bankruptcy
b.
Chapter 11 bankruptcy
d.
Chapter 17 bankruptcy
 

 39. 

Late fees and over-the-limit fees on your credit card bill can
a.
each cost you $35 or more
b.
cause the interest rate you are charged to rise
c.
affect your credit score in a negative manner
d.
all of these
 

 40. 

When reconciling a bank statement, the amount of outstanding checks is
a.
deducted from the bank statement balance
b.
added to the bank statement balance
c.
deducted from the checkbook register balance
d.
added to the checkbook register balance
 

 41. 

Which of the following methods of avoiding bankruptcy requires you to turn over your checking account and bills to a debt manager?
a.
credit counseling
c.
debt consolidation
b.
debt management
d.
credit protection service
 

 42. 

When reconciling a bank statement, the amount of deposits in transit is
a.
deducted from the bank statement balance
b.
added to the bank statement balance
c.
deducted from the checkbook register balance
d.
added to the checkbook register balance
 

 43. 

The form used to report taxable income a worker received during the calendar year is
a.
Form 1040
c.
Form W-2
b.
Form 1040A
d.
Form W-4
 

 44. 

A married person with five children filing a joint tax return may claim
a.
two exemptions
c.
six exemptions
b.
five exemptions
d.
seven exemptions
 

 45. 

Bankruptcy exemptions may include which of the following?
a.
homestead (home equity) up to $21,625
c.
tools of trade up to $11,525
b.
jewelry up to $10,000
d.
household goods up to $15,525
 

 46. 

Which of the following is the most liquid?
a.
savings account
c.
certificate of deposit
b.
money market account
d.
savings bond
 

 47. 

Under which type of bankruptcy does the debtor (individual) follow a court-approved plan to pay back as much debt as possible over a three- to five-year period? Sometimes refered to an re-organization.
a.
Chapter 7 bankruptcy
c.
Chapter 13 bankruptcy
b.
Chapter 11 bankruptcy
d.
Chapter 17 bankruptcy
 

 48. 

The legal process that allows a lender to take possession of a house because the borrower does not meet his or her mortgage obligations is called
a.
garnishment
c.
bankruptcy
b.
foreclosure
d.
discharge
 

Completion
Complete each statement.
 

 49. 

A check marked “NSF” and returned to the payee’s bank unpaid is said to have __________.
 

 

 50. 

A(n) __________ is a tool used to track checking account transactions and keep a running balance of your account.
 

 

 51. 

When a car is pledged as collateral on a secured loan and the debtor fails to make payments, the creditor may __________ the car and sell it to pay the debt.
 

 

 52. 

__________ pay is the amount you take home after deductions have been subtracted.
 

 

 53. 

__________ is the act of signing another person’s name on a check.
 

 

 54. 

A(n) __________ is a person who depends on you for more than half of his or her support.
 

 

 55. 

When a creditor has a legal __________ order, part of an employee’s paycheck is withheld and sent directly from the employer to the creditor.
 

 

 56. 

Many people rent a(n) __________, which is a secure container located in a bank vault, to store important documents and valuable jewelry.
 

 

 57. 

Overtime pay is typically __________ times the regular pay rate.
 

 

 58. 

To help keep a watchful eye on your credit file, you may want to enroll in a(n) __________, which is a plan that provides credit monitoring for a fee.
 

 

 59. 

With __________ scams, a company claims to be able to “fix” your poor credit record and give you a clean credit history.
 

 

 60. 

__________ interest is earned on both principal and previously earned interest.
 

 

 61. 

The __________ Act protects consumers from discrimination in the granting or denying of credit.
 

 

 62. 

If the bankruptcy court suspects that a debtor has purposely overspent while staying below the allowable exemption amounts, it may dismiss the bankruptcy case and prosecute the debtor for bankruptcy __________.
 

 

 63. 

The __________ period is the amount of time you have to pay your credit card bill without having to pay interest on your new purchases.
 

 

 64. 

A __________ endorsement consists only of the payee’s signature.
 

 



 
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