Chapter 8 memory quiz vocab

Question 1

bank

Answer 1

a financial institution licensed to receive deposits and provide financial services

Question 2

federal deposit insurance corporation

Answer 2

independent federal agency that insures deposits in bank accounts up to $250,000

Question 3

National Credit Union Administration

Answer 3

independent federal agency that insures deposits in credit unions up to $250,000

Question 4

unbanked

Answer 4

people who don’t have bank accounts

Question 5

underbanked

Answer 5

people who have savings or checking accounts but still use alternative financial products and services

Question 6

retail banks

Answer 6

for-profit financial institutions that accept deposits and offer a variety of deposit accounts and financial services

Question 7

credit unions

Answer 7

nonprofit financial institutions that are owned and operated by their members; offer deposit accounts and lending services similar to a retail bank but at a lower cost

Question 8

online banks

Answer 8

also known as internet banking; all transactions are done online; no physical location

Question 9

overdraft protection

Answer 9

an option offered by banks to cover overspending an account and then charge a fee for it

Question 10

overdraft fee

Answer 10

a penalty charged if the account holder spends more than their account balance, causing the available balance to go below zero

Question 11

liquidity

Answer 11

how quickly you can access the money in an account or the value of an asset without a penalty or fee

Question 12

checking account register

Answer 12

also called a ledger; a lined and divided journal to record checking account activity

Question 13

direct deposit

Answer 13

option to allow automatic electronic deposit of your payroll checks

Question 14

reconciling

Answer 14

the process of making sure you and the bank agree on how much money is in your checking account