Practice Test Answers

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1
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How do bank loans help the nation’s economy?

A
They ensure consumer spending and confidence.
B
They ensure the success of new businesses.
C
They allow consumers to quickly pay off debts.
D
They allow businesses to expand and improve.
2
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Which best describes the economic impact of defaulting on bank loans?

A
The economy suffers because banks have less money to loan to others.
B
The economy suffers because people are scared to take out loans.
C
The economy suffers because people have less money to spend.
D
The economy suffers because businesses are scared to take out loans.
3

Credit unions differ from retail banks because they are

A
owned and managed by private corporations.
B
owned by their employees.
C
owned by shareholders who purchased stock.
D
owned by their members.
5

Read the scenario. Local officials in a small town are discussing a proposal to construct an outdoor stage in central downtown. They agree to survey individuals, organizations, and businesses in the community before they make a decision. Why do the local officials survey different community groups before making a decision?

A
Different community groups’ opinions are valued more than others.
B
Different community groups might value the proposal differently.
C
The officials need all community members to contribute to the project.
D
The officials need all community members to agree on the proposal.
6

Read the scenario. The Carvel City Council held a vote to decide how to spend part of the city budget on a new social program. They had three programs to choose from: providing dental clinics for low-income residents, building additional affordable housing, or supplying nutritional support to older people. Which statement describes an opportunity cost if the council members vote to provide dental clinics for low-income residents?

A
Carvel’s homeless population will increase as a result of insufficient affordable housing.
B
Carvel’s low-income residents will experience a decline in their overall health.
C
Carvel’s low-income residents will have more access to affordable housing.
D
Carvel’s low-income residents will experience an overall improvement to their health.
7

How are online banking and E-checks similar?

A
Both move money electronically without using cash or checks.
B
Both are not secure so transactions are recorded on a physical ledger.
C
Both use the same banking systems as regular checks.
D
Both need customers to go to a physical place to finish a transaction.
8

How are E-checks and electronic fund transfers (EFTs) similar in the way they process transactions?

A
Both charge the payer the same fee for each transaction.
B
Both need a physical card to start the transaction.
C
Both can only be started during the bank's working hours.
D
Both can move money directly from one bank account to another.
9

Why were savings and loans (S&Ls) originally established?

A
to help people save money
B
to help people invest in small businesses
C
to help people invest in the stock market
D
to help people buy homes
10

Choose the method of pay that would result in the most earnings for one month on sales of 73 dollars comma 620

A
Graduated commission of 5 percent on the first 35 dollars comma 000 in sales and 7 percent on anything over that.
B
Monthly salary of 3 dollars comma 000 plus 2 percent commission on all sales.
C
Straight commission of 6 percent on all sales.
D
Graduated commission of 4 percent on the first 50 dollars comma 000 in sales and 9 percent on anything over that.

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