Econ - Unit 9 Review

When you deposit money into a savings account, you get paid

• back what you put into it

• interest

• in frequent flier miles

• when you retire

Banks take money from your savings account and loan it to other people.

• TRUE

• FALSE

Interest is

• the cost of borrowing money

• something you don't want to accumulate

• the "penalty" you have to pay for not using your account

• what you pay the bank for a savings account

Credit unions, unlike banks, share their profits with their customers.

• TRUE

• FALSE

With compounding interest

• you make a lot of money in a short period of time

• you make little money over a long period of time

• you make a lot of money over a long period of time

• you make little money, but much more quickly

You should open a bank account at the same bank where your parents have one.

• TRUE

• FALSE

A checking account is the same thing as a DDA

• TRUE

• FALSE

Which of the following is NOT recommended for building your credit history?

• getting & maintaining a job

• borrowing money with a credit card

• always paying the minimum balance on your card

• paying your phone bill on time every month

When you borrow money, you enter into a contract enforceable by law

• TRUE

• FALSE

Since the contract is enforceable by law, you have no other option than to pay the money back to the creditor.

• TRUE

• FALSE