Money And Banking

Question 1

Barter

Answer 1

Swapping goods with each other

Question 2

Money

Answer 2

Anything generally accepted by the majority of people in exchange for goods and services

Question 3

Legal tender

Answer 3

Issued by the Central Bank and must be accepted as payment

Question 4

Currency

Answer 4

Official money of a country

Question 5

Functions of money

Answer 5

Medium of exchange (used to buy things)
Measure of value (measuring the price of things)
Store of wealth (a way of saving)

Question 6

Features of money

Answer 6

Portable
Durable
Divisible
Confidence - people must believe it’s genuine

Question 7

Saving

Answer 7

Not spending money

Question 8

Investing

Answer 8

Putting your savings to work to earn extra income called interest

Question 9

Why do people save

Answer 9

To pay for something they can’t afford right now
To provide an income for the future
In case of unforeseen events

Question 10

What to consider when choosing a financial institution

Answer 10

Safety
Tax (DIRT)
Interest
Convenience

Question 11

Formula for simple interest

Answer 11

Sum saved X time X rate of interest
————————————————
100

Question 12

What does CAR stand for

Answer 12

Compound Annual Rate

Question 13

DIRT

Answer 13

Deposit Interest Retention Tax

Tax paid on the interest that you receive from your savings

Question 14

Financial institutions

Answer 14

Commercial banks
Building societies
Credit unions
An Post

Question 15

Opening a current account

Answer 15

Photo identification 
Proof of address
Specimen signature
Contact information
Date of birth
PPS number

Question 16

Paypath

Answer 16

Wages is lodged directly into current account by employer

Question 17

Advantages of pay path

Answer 17

Employer doesn’t need large amounts of cash on the premises
Employer does t need to fill in chequers
Employees don’t need to go to the bank

Question 18

Payments from a current account can be done by

Answer 18

Cheque 
Credit transfer
Bank draft
Standing order
Direct debit

Question 19

Credit transfer (C/T)

Answer 19

Used to make a single payment to someone else’s account, a giro is used

Question 20

Bank draft

Answer 20

A special form of cheque drawn by the bank, mainly for very large payments

Question 21

Standing order (SO)

Answer 21

An instruction to pay a FIXED sum into a bank account at regular intervals
e.g loan repayments or rent

Question 22

Direct Debit (DD)

Answer 22

Permission given to a company to take money directly from the customer’s account, the SUM varies

Question 23

Stale cheque

Answer 23

A cheque presented to the bank more than 6 months after it has been written

Question 24

Blank cheque

Answer 24

A signed cheque with at least one piece of information left out

Question 25

Endorsed cheque

Answer 25

The payee has signed the back of the cheque so someone else can negotiate it

Question 26

Negotiating a cheque

Answer 26

Cashing in a cheque

Question 27

Post-dated cheque

Answer 27

A cheque with a date in the future on it

Question 28

Receipt cheque

Answer 28

A cheque that must be signed by the payee to negotiate it

Question 29

Dishonoured cheque

Answer 29

A cheque that the bank refuses to pay out

Perhaps the drawer doesn’t have enough money

Question 30

Stopped cheque

Answer 30

The drawer instructed the bank to dishonour the cheque

Question 31

Crossed cheque

Answer 31

Two parallel lines on the cheque meaning the cheque must be paid into a bank account

Question 32

Open cheque

Answer 32

A cheque not crossed

Question 33

Forms of money

Answer 33

Barter
Legal tender
Chequers
Plastic cards - debit/credit card
Currency