Business Law Objective 6.0- Roles Of Financial Institutions Quiz

24 Questions | Total Attempts: 94

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Business Law Objective 6. 0 Roles of Financial Institutions.


Questions and Answers
  • 1. 
    Christian has just received his first checking account bank statement. He pulls out his checkbook and looks to find his outstanding checks and deposits and check his balance. What is Christian doing?
    • A. 

      Calculating his deposit slips

    • B. 

      Comparing purchase receipts

    • C. 

      Reconciling the statement

    • D. 

      Writing a third party check

  • 2. 
    Karen is preparing the daily deposit of checks for her sporting goods business. Which endorsement should she use on the checks to make the deposit?
    • A. 

      Blank

    • B. 

      Restrictive

    • C. 

      Special/Full

    • D. 

      Transfer

  • 3. 
    Daniel is going on vacation and does not wish to take cash. Which type of negotiable instrument should he take with him?
    • A. 

      Cashier's check

    • B. 

      Large cash bills

    • C. 

      Money order

    • D. 

      Traveler's checks

  • 4. 
    Lorin is very careful when writing checks. Which check writing procedure does she use to avoid negligence when writing a check?
    • A. 

      Changing the figures and written amount

    • B. 

      Not signing check

    • C. 

      Writing close to "Pay to the Order of"

    • D. 

      Writing figures only

  • 5. 
    Belinda has opened a checking account and wants to avoid writing a bad check. What should she do to avoid writing a bad check? What should she do immediately?
    • A. 

      Ask the bank to issue a stop payment

    • B. 

      Check for outstanding deposits

    • C. 

      Make a deposit and then write the check

    • D. 

      Verify the account balance will cover check

  • 6. 
    Shawn wrote a promissory note to Larry. What term identifies Shawn in this transaction?
    • A. 

      Acceptor

    • B. 

      Drawee

    • C. 

      Drawer

    • D. 

      Maker

  • 7. 
    Craig returned a recently purchased stereo to Electronic Warehouse for a full refund. Last week Craig's credit card bill still showed a charge for the purchase. What law could help Craig correct this error?
    • A. 

      Disputed Charges Reform Act

    • B. 

      Fair Credit Billing Act

    • C. 

      Fair Credit Reporting Act

    • D. 

      Federal Trade Commission Act

  • 8. 
    Bob cashed a check at a local store. What term identifies the store in this transaction?
    • A. 

      Acceptor

    • B. 

      Maker

    • C. 

      Payee

    • D. 

      Principal

  • 9. 
    If Terri forgets to deposit a check to her account, what term would be used to describe this check after six months?
    • A. 

      Insufficient check

    • B. 

      Outstanding check

    • C. 

      Postdated check

    • D. 

      Stale check

  • 10. 
    Which endorsement should Terri make on checks that she deposits into her own account?
    • A. 

      Blank

    • B. 

      Restrictive

    • C. 

      Special/Full

    • D. 

      Transfer

  • 11. 
    Terri uses her $450 paycheck to pay her rent. Which endorsement should Terri make on the check she used to pay her rent?
    • A. 

      Blank

    • B. 

      Restrictive

    • C. 

      Special/Full

    • D. 

      Transfer

  • 12. 
    Terri cashed her paycheck. Which endorsement should Terri make on the check she cashed?
    • A. 

      Blank

    • B. 

      Restrictive

    • C. 

      Special/Full

    • D. 

      Transfer

  • 13. 
    Stephen uses his home as security for a loan. Which term describes the use of his home in this transaction?
    • A. 

      Collateral

    • B. 

      Credit

    • C. 

      Interest

    • D. 

      Surety

  • 14. 
    Mark's credit report indicates non-payment of a credit card bill. Mark wants to correct this error. Which act was passed by Congress to assist Mark in correcting this dispute?
    • A. 

      Disputed Charges Reform

    • B. 

      Fair Credit Billing

    • C. 

      Fair Credit Reporting

    • D. 

      Fair Debt Collection Practices

  • 15. 
    Theresa's credit card company adds finance charges to last month's ending balance. Which type of finance charge method is being used?
    • A. 

      Adjusted Balance Method

    • B. 

      Annual Percentage Rate Method

    • C. 

      Average Daily Balance Method

    • D. 

      Previous Balance Method

  • 16. 
    Joan is concerned she will be turned down for a loan because she is a single female. What law protects her against this concern?
    • A. 

      Equal Credit Opportunity Act

    • B. 

      Fair Credit Billing Act

    • C. 

      Fair Credit Reporting Act

    • D. 

      Fair Debt Collections Act

  • 17. 
    Daniel buys goods on credit or borrows money. Which term identifies Daniel?
    • A. 

      Creditor

    • B. 

      Debtor

    • C. 

      Loanee

    • D. 

      Secured Party

  • 18. 
    Susie loses her credit card. Unauthorized charges are made on the card before notifying the issuing company. How much is Susie liable for?
    • A. 

      $100

    • B. 

      $25

    • C. 

      $50

    • D. 

      $75

  • 19. 
    Vince is being threatened by his credit card company after falling behind in his payments. What law protects him against this concern?
    • A. 

      Equal Credit Opportunity Act

    • B. 

      Fair Credit Billing Act

    • C. 

      Fair Credit Reporting Act

    • D. 

      Fair Debt Collections Act

  • 20. 
    Bart has no chance of getting out of debt and needs to liquidate all his belongings to pay creditors. Bart should file for which type of bankruptcy?
    • A. 

      Chapter 7

    • B. 

      Chapter 11

    • C. 

      Chapter 12

    • D. 

      Chapter 13

  • 21. 
    Mike has not made a payment on his car in over 6 months. What will the bank do with his car?
    • A. 

      Draft it

    • B. 

      Foreclose on it

    • C. 

      Repossess it

    • D. 

      Sell it

  • 22. 
    James pledges a security for a car loan. What is the term used for the pledge?
    • A. 

      Collateral

    • B. 

      Credit

    • C. 

      Interest

    • D. 

      Surety

  • 23. 
    Jan's landlord threatens to report unsubstantiated debts on her credit. What law protects her against this concern?
    • A. 

      Equal Credit Opportunity Act

    • B. 

      Fair Credit Billing Act

    • C. 

      Fair Credit Reporting Act

    • D. 

      Fair Debt Collections Act

  • 24. 
    What is the purpose of bankruptcy laws?
    • A. 

      Give creditors an opportunity to recover from overwhelming debt

    • B. 

      Give debtors an opportunity to recover from overwhelming debt

    • C. 

      Pay selected creditors only

    • D. 

      Pay only selected debtors

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