Unit 1 Review (Checking)

You have a checking account WITH overdraft protection and an ACTUAL balance of $200. You haven’t reviewed your statement in a while, so you THINK you have about $400 in your checking account. You buy $300 of books for your next semester using your debit card at the college bookstore. What is the result of this transaction?

• You are all set. Since you had the necessary funds in your savings account, the transaction is OK
• You are able to purchase $300 worth of books, BUT your account balance goes to -$100, which you have until your next statement to repay without penalty
• You are able to purchase $300 worth of books, BUT you have a $35 fee for the overdraft and you need to make up the $100 difference with a deposit of at least that much
• Your card is declined because you don't have $300 in your checking account

What is the largest and most common checking account fee?

• Check printing charges
• Monthly service charge
• ATM fees
• Overdraft fees

Mia is opening her first checking account, and she's trying to decide whether she should sign up for overdraft protection. Which friend's advice is most accurate?

• Jordan says, "With overdraft protection, you never have to worry about how much money is in your account."
• Donnie says, "Yes, you'll have to pay a fee for each overdraft, but you DON'T have to pay the bank back the money you overdrew the account by."
• Frank says, "Overdraft protection is handy if you have an emergency (like needing gas to get to work) and don't have the funds right now."
• Alex says, "If you don't get overdraft protection, and you TRY to withdraw more than what's in your account, you pay a fee anyway."

Your cousin Justine overdraws her checking account at least 4 times per month every month. Which of the following recommendations seems the most reasonable to help get her account under control?

• Justine should rework her budget and cut out nonessential purchases each month
• Justine should shut down her checking account and start paying for everything in cash
• Justine should keep her strategy the same and hope she has fewer expenses next month
• Justine should set alerts on her account, which will completely prevent her from overdrawing

You sign up for a new checking account and decide NOT to take overdraft protection. On a day when you have $15 in your checking account, you swipe your debit card to purchase $50 of groceries at the local supermarket. What would happen next?

• You would be charged a $35 fee by your bank
• Your transaction would be declined and you would not be able to purchase the groceries
• Your bank will cover the cost, and you'll just pay them back later
• You will be charged a penalty fee for trying to "scam" the supermarket into selling you groceries you cannot afford

You are a customer with an Everyday Checking Account. Indicate which statement about your account is TRUE.

• You need a minimum deposit of $50 to open the account online
• You are earning interest on this account
• If you are between 17 and 24, you will not pay a monthly service fee
• Your monthly service fee is waived if you have at least $1,500 as a daily balance

You have overdraft protection on your checking account. The overdraft fees are $34 for each transaction when your account is overdrawn. You start the day with $5 in your checking account and spend $10 for a movie ticket, $7 for two slices of pizza and $20 at the mall for some clothes. How much in overdraft fees will you owe the bank?

• $0. You are covered since you have overdraft protection.
• $32
• $34
• $102

Margaret is generally happy with her checking account, so she doesn’t have interest in changing banks. When reviewing her September bank statement, she notices four separate fees: a monthly fee, 3 out-of-network ATM fees, 2 overdraft fees, and a bounced check fee. Which fee would be HARDEST for her to eliminate next month?

• The monthly fee
• The out-of-network ATM fees
• The overdraft fees
• The bounced check fee

Suzanne finds the process of reviewing her monthly bank statements to be very long and boring, so she doesn’t do it very often. Which consequence is LEAST likely to occur to Suzanne?

• Her credit score will go down
• She’ll accrue overdraft fees
• She won’t know how much money is in her account or how much she can spend
• She may find it hard to open a new account at a different bank

Which item would you expect to find on your monthly bank statement?

• The cost of using out-of-network ATMs
• The terms and agreement of your account
• A list of the specific deposits you have made recently
• The per transaction cost of using your debit card in foreign countries