A1

Question 1

What are the functions of money

Answer 1

-Unit of account
-Means of exchange
-Store of value
-Legal tender

Question 2

What are the roles of money

Answer 2

-personal
-life stages
-culture
-life events
-external influences
-interest rates

Question 3

Definition of debt

Answer 3

Money owed

Question 4

Definition of credit rating

Answer 4

A score given to indeviduals as how likely they are to repay debts on previous acounts

Question 5

Definition of bankruptcy

Answer 5

When you can not repay your debt and file for bankruptcy

Question 6

Define solvent

Answer 6

The ability to meet day-day expenses and repay debt

Question 7

Define cash

Answer 7

Notes and coins in a wide range of denominations

Question 8

Define debit card

Answer 8

Card issued by your bank, money spent on goods is deducted from your current account

Question 9

Credit card

Answer 9

Issued by financial institutions, allows customers to delay payment

Question 10

Define cheque

Answer 10

A paper transaction giving a bank permission to transfer payment from your account to another persons bank account

Question 11

Define electronic transfer

Answer 11

Payment is transferred directly from one bank account to another

Question 12

Define direct debit

Answer 12

Permission given to the bank to make regular payment me to a third party upon request

Question 13

Define standing order

Answer 13

A fixed amount of money if taken out of your bank account on a specified date

Question 14

Define prepaid cards

Answer 14

Upload money to the card and spending reduces the balance

Question 15

Define contactless cards

Answer 15

Payment made by swiping a contactless terminal

Question 16

Define charge cards

Answer 16

Issued by financial institutions, buy now pay later

Question 17

Define store cards

Answer 17

Issued by a retail outlet buy now pay later

Question 18

Define mobile banking

Answer 18

Use a tablet or smartphone to manage your bank accounts

Question 19

Explain two benifitw of pre-paid credit cards

Answer 19

-Helps you manage your spending and stick to a budget
-it’s safer than to carry large amounts of money and cannot be stolen easily

Question 20

Advantages of standard accounts

Answer 20

No charge unless overdrawn Can revive wages in pay direct debit cheque books debit cards overdraft facility and cash withdrawls

Question 21

Disadvantages of standard accounts

Answer 21

No extra benefits
Very low interest
Overdraft is expensive