General Retail Banking Industry And Processes MCQs

1. Which of the following is a characteristic of a certificate of deposit?

2. Would a bank be allowed to pay someone from a personal account without a mandate from the customer?

3. What would a person do if they wanted to have the facility to save money as well as issue checks?

4. What does the term "Availability Float" imply?

5. What is the ratio of bank reserves to bank deposits called?

6. What is meant by the term "Redemption"?

7. How is a savings account different from a certificate of deposit?

8. What is the signing of a check on its back by the payee referred to as?

9. What is the process which the Federal Reserve uses to influence the availability and cost of money and credit called?

10. Why is a negotiable instrument a "special contract"?

11. What does the term "Debenture" imply?

12. How do banks offer services to all levels and types of individuals and still earn money?

13. Which of the following is a requirement that a bank has to comply with?

14. Which of the following is a feature often found in an offshore bank account, not usually found in an onshore bank account?

15. What is meant by the term Retail Banking?

16. What is another name for a bill of exchange?

17. Why are offshore banks often able to offer a client higher interest rates?

18. What is the government entity that insures bank balances?

19. What is meant by "restrictive endorsement"?

20. What are the four requirements for a promissory note to be legal?

21. How is a money market account different from a savings account?

22. Which of the following is not covered by the FDIC?

23. What does the term "Ex Gratia Payment" mean?

24. What is the payment that people receive after a mishap which leaves them in the same financial position as they were in before they suffered the loss called?

25. What type of account would someone who wants the facility to pay people through checks open?

26. What amount would someone who has $500,000 in one bank and $250,000 in another bank be insured for in total?

27. What method would a consumer most likely use to move funds between their offshore account and their domestic account?

28. Which of the following would not be covered by the FDIC?

29. What level will the FDIC insure any one person at a bank for beginning January 1, 2010?

30. What is the definition of an offshore bank?

31. What was the purpose of the 2006 Deposit Insurance Fund?

32. Why can't anyone start a new bank?

33. What is a secondary way through which banks earn money?

34. What does the term "Netting" mean?

35. What is meant by the term "Amortization"?

36. What is the current maximum limit that the FDIC will insure any one person at a bank for?

37. Checking all bank account papers to make sure that the bank records and your records agree is known as:

38. What is meant by the term "Thrift"?

39. What is one criticism of offshore banking?

40. What is a "bill of exchange"?

41. How have banks changed in recent years to respond to customer needs and wants?

42. What is a "promissory note"?

43. Why do banks charge higher interest rates from customers with poorer credit?

44. Why do offshore banks not save someone from paying taxes on the money in the account?

45. What is the definition of a negotiable instrument?

46. What amount would a customer be covered for by the FDIC if he/she had $250,000 in savings at Bank XYZ, and also $50,000 in a retirement account with the same bank?

47. What amount would a customer be insured for if they made deposits to their accounts at three different locations of their bank?

48. What is an example of 'restrictive endorsement'?

49. What is meant by the term "Clearing House"?

50. When was the FDIC established?

51. What is the purpose of the FDIC?

52. What would happen if Mr. X made a check out to Mr. Y for $100, who indorsed the check, and then sold it for $50 to Mr. Z? Would Mr. Z be able to cash the check?

53. Which of the following is a reason for a person to open an offshore account?

54. What is meant by "online banking"?

55. Which of the following is a benefit of an offshore bank account?

56. What does the term "Nostro Account" imply?

57. Why do banks offer debit cards and off-site ATM machines?

58. What does FDIC stand for?

59. What is meant by the term "Discrete Compounding"?

60. Which of the following is a risk with having money in a bank?

61. What is a typical retail banking service?

62. What does MMDA stand for?

63. What is "Demand Deposit" account another name for?

64. What is a negotiable instrument drawn against deposited funds to pay a specified amount of money to a specific person on demand called?

65. Why was the FDIC created?

66. Why do the words Debit and Credit have meanings on a bank statement different from the ones which they have in normal accounting ( i. e. a debit is actually a withdrawal, a credit a deposit)?

67. What is a bank branch?

68. What is the situation in which many customers try to withdraw their bank deposits simultaneously, but the bank's reserves are not sufficient to cover the withdrawals called?

69. Why was the FDIC limit of insurance raised to $250,000 temporarily in 2008 thru 2009?

70. What is the primary way a bank earns money?

71. What is the primary function of a bank?

72. What is meant by the term "risk based pricing"?

73. What does the term "Straight Paper" denote?

74. What is a holder in due course?

75. What is the term which describes illegally benefiting from float e. g. by depositing and drawing checks between accounts at two or more banks?

76. What type of account would someone put their money into if they wanted to earn a high rate of return and not to have access to their money for a fixed period e.g. 90 days?

77. What is "Negotiable Order of Withdrawal Account" i.e. NOW Account, another name for?

78. What can the FDIC do to a member bank if the bank fails to comply with the set standards?

79. What type of account would someone who wants to earn a high rate of interest and does not intend to have many transactions open?

80. How does a bank make money by providing currency exchange services to its customers?

81. What is meant by the term "Bank Spread"?