Semester Test Study Guide
Name: ______________________________ Period: ______________________
1. Checking Accounts – Handout
o What is an outstanding check?
o What is a NSF or bounced check?
o List the steps in reconciling a checking account.
o What is a canceled check?
o What are the guidelines when selecting a PIN number?
o Explain the difference between a commercial bank and a credit union.
o What is an advantage of credit unions over commercial banks?
o What is a safe deposit box & what is it used for?
2. Financial Institutions – Handout
o What organizations provide insurance for depositors at credit unions &
3. Credit Reports & Credit Scores – covered during credit card unit
o What is a credit score?
o What are credit scores used for?
o What information is on a credit report?
o Who has a credit report?
o Who has access to a credit report?
o List the three major credit bureaus.
o When can an individual view their credit report for free?
o List things that have a negative impact on a person’s credit report & credit
4. Credit Cards – Handout
o List several disadvantages of using credit cards.
o List several advantages to using a credit card.
o Why is the interest rate for credit cards higher than with many other types
o Explain the difference between a credit card and a debit card.
o What is the Schumer box?
o What is a grace period?
o What is a finance charge?
o What does APR stand for?
o What is a penalty rate? (default APR)
5. Investing in Stocks – Chapter 12
o Stock Market Game
What is a round lot?
What is buying on margin (leverage)?
What is selling short?
o Explain the following types of stock:
Blue Chip Stocks
o When do corporations pay dividends?
o What is the role of the board of directors?
o What is a proxy?
o List the three major American stock exchanges we discussed in class?
o What is a stock split & what is the purpose of it?
o Explain the difference between capital loss & capital gain
o What is par value?
o What is market value?
6. Investing in Bonds – Chapter 13
o Explain the difference between stocks & bonds.
o How often are interest payments usually paid to bondholders who hold
o How are bonds rated? What is the highest and the lowest rating that a bond
o What is meant by the “selling at a premium” and “selling at a discount?”
What impact does each have on the investor’s return?
o Do municipal bonds or corporate bond usually have a higher return? Why?
o What is a debenture?
o What is a junk bond?
o What is a coupon bond?
o What is a convertible bond? When would an investor want to covert it?
7. Mutual Funds & Other Investments – Chapter 14
o What is a prospectus?
o List advantages and disadvantages of investing in real estate.
o What is a mortgage?
o What is a mutual fund?
o List and explain the fees associated with investing in a mutual fund.
o List 3 advantages of investing in mutual funds.
o What is a bond fund?
o What is an index fund?
o What is a money market fund?
o What is capital gains tax?
o List advantages and disadvantages to investing in precious metals & gems.
o What is a futures contract?
o List advantages and disadvantages to investing in collectibles.
8. Retirement Accounts – Chapter 15
o Who pays a gift tax?
o What is a reverse mortgage? List advantages and disadvantages of a
o Defined benefits plans
o Defined contribution plan
o Holographic will
o Power of attorney
o Traditional IRA
o Roth IRA
o Education IRA
9. Federal Income Tax – Chapter 7
o List and explain the three types of taxes. List an example of each type of
o When should a taxpayer itemize?
o What is the term for willful failure to pay taxes?
o List the agency that collects taxes and enforces tax laws in the US.
o When is the deadline for filing a tax return?
o What is a dependent?
o What are W-4, W-2, & and an I-9 forms used for?
10. Insurance – Chapters 25, 26, & 27
o Personal risk
o Liability risk
o Risk avoidance
o Risk reduction
o Risk assumption
o What is the term for the cost of insurance?
o What type of car insurance do all drivers legally need to have?
o What is a personal property floater?
o What is an attractive nuisance?
o Collision insurance
o Comprehensive insurance
o Insurance adjuster
o Insurance investigator
o What is group insurance usually less expensive than individual insurance?
o What is a double indemnity clause?
11. Housing – Chapters 21 & 22
o List advantages & disadvantages of renting.
o List advantages & disadvantages of owning.
o Who pays the realtor’s fee?
o Closing date
o What is the purpose of a security deposit?
o What types of information can a landlord ask a potential tenant on a rental
o Closing costs
o What does MLS stand for?
o What is earnest money? What is the purpose of it?
o What is a deed?