1) The interest rate earned on a money market deposit account is generally higher than the interest earned on a Bank savings account.

ENGR.ECONOMIC ANALYSIS
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Chapter1: Making Economics Decisions
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1) The interest rate earned on a money market deposit account is generally higher than the interest earned on a Bank savings account.

2) What are short-term notes of debt issued by the federal government commonly called?

A) T-Bills

B) T-Notes

C) T-Bonds

D) T-Accounts

E) None of the above are correct.

3) What is the name for comprehensive financial services packages offered by brokerage firms?

A) asset management accounts

B) comprehensive management accounts

C) platinum management accounts

D) consolidated management accounts

E) None of the above are correct.

4) Money market mutual funds provide an alternative to traditional liquid investments offered by financial institutions.  Advantages of MMMFs include which of the following?

A) high interest rates

B) check-writing privileges

C) minimal risk

D) convenience--deposits made through payroll deductions

E) All of the above are correct.

5) A savings alternative that pays a fixed rate of interest while keeping your funds on deposit for a contracted period of time that can range from 30 days to several years is called a

A) demand deposit.

B) negotiable order of withdrawal deposit.

C) term deposit.

D) certificate of deposit.

E) None of the above are correct.

6) Savings accounts are insured at the ________ level. 

A) local

B) state

C) federal

D) All of the above are correct.

E) None of the above are correct

7) What is another name for an interest-bearing checking account?

A) demand deposit

B) IBC

C) NOW

D) CWI

E) none of the above

8) Of the following, which one is not an advantage of a CD as a cash management alternative?

A) fixed interest rate, beneficial if interest rates drop

B) wide selection of maturities

C) is insured

D) liquidity

E) convenient to purchase

9) Negotiable Order Of Withdrawal (NOW) accounts require consumers to keep a minimum balance in the account.  This balance represents the ________ cost of those funds; in that, they cannot be used elsewhere. 

A) optional

B) opportunity

C) liquidity

D) extraneous

E) None of the above.

10) Pick the advantage of a certificates of deposit from this list of possibilities.

A) The interest paid is compounded daily.

B) Early withdrawals after 30 days do not incur a penalty.

C) Interest rates are generally higher than typical savings accounts.

D) They earn the APY and not the APR.

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