#1
Which of the following is not a type of account typically offered by banks?
Grocery account
ExplanationNot a standard banking account type.
#2
Which of the following is a common type of investment account that allows individuals to buy and sell various financial instruments?
Brokerage account
ExplanationFacilitates trading of securities and investments.
#3
What is the primary function of the Central Bank in a country's financial system?
Controlling inflation and monetary policy
ExplanationManages monetary policy and currency.
#4
What is the significance of the Dow Jones Industrial Average in finance?
It measures the performance of a specific group of stocks
ExplanationBenchmark index for stock market performance.
#5
What is the difference between a traditional IRA and a Roth IRA?
Contributions to a traditional IRA are tax-deductible, while Roth IRA contributions are not.
ExplanationTax treatment of contributions differs.
#6
What does APR stand for in the context of loans?
Annual Percentage Rate
ExplanationRate representing the annual cost of borrowing.
#7
What is the primary function of the Federal Reserve in the United States?
Regulating financial institutions
ExplanationOversees and regulates banking operations.
#8
What is the purpose of a credit score?
To evaluate a person's creditworthiness
ExplanationDetermines likelihood of repaying debts.
#9
What is the role of the Securities and Exchange Commission (SEC) in the United States?
Regulating the stock and securities industry
ExplanationOversees securities markets to ensure fairness.
#10
What is the purpose of a mutual fund?
To pool money from multiple investors and invest in a diversified portfolio
ExplanationCollective investment vehicle for diversification.
#11
Which financial statement provides a snapshot of a company's financial condition at a specific point in time?
Balance sheet
ExplanationSummarizes assets, liabilities, and equity.
#12
What is the concept of compound interest?
Interest calculated on both the principal and the accumulated interest
ExplanationInterest computed on the initial principal and accrued interest.
#13
In banking terms, what does FDIC stand for?
Federal Deposit Insurance Corporation
ExplanationInsures deposits in U.S. banks for up to a limit.
#14
What is the purpose of a 401(k) retirement account?
Saving for retirement through pre-tax contributions
ExplanationTax-advantaged retirement savings plan.
#15
In the context of credit cards, what is the 'minimum payment'?
The lowest monthly payment you must make to avoid late fees
ExplanationLowest amount to keep account current.