Everfi Module 2 Employment And Taxes Answers
With a focus on practical skills, Everfi module 2 guides learners through essential topics, turning complex ideas into manageable, everyday knowledge.
By engaging with interactive lessons and real-life scenarios, you’ll discover how to effectively budget, save, and plan for your financial future. This module not only equips you with critical tools but also inspires confidence in your ability to navigate the financial landscape.
Whether you’re a student preparing for adulthood or an adult looking to enhance your financial acumen, Everfi Module 2 offers valuable insights that can set you on the path toward financial wellness.
Understanding Financial Literacy with Everfi Module 2
What are the three main responsibilities of the Federal Reserve?
Answer:
1. Provide and maintain an effective payment system
2. Supervise and regulate banking operations
3. Conduct monetary policy
Explanation:
The Federal Reserve plays a crucial role in ensuring that the financial system operates smoothly. Its responsibilities include facilitating efficient payment systems, overseeing banking institutions to ensure stability, and implementing monetary policy to manage economic growth and inflation.
Which type of financial institution typically has some sort of requirement to be a member?
Answer:
Credit Union
Explanation:
Credit unions are member-owned financial cooperatives that require individuals to meet certain criteria for membership. This often includes living in a specific area, working for a certain employer, or being part of a particular organization.
Which type of bank account is typically the most liquid?
Answer:
Checking Account
Explanation:
Checking accounts offer the highest liquidity among bank accounts, allowing for easy and quick access to funds for daily transactions without penalty or delay.
Compare/contrast a checking account and savings account. Which offers more interest? Which is easier to get money out of?
Answer:
A savings account offers more interest. Checking accounts are easier to withdraw money from.
Explanation:
Savings accounts typically have higher interest rates, helping funds grow over time, while checking accounts prioritize ease of access, allowing for frequent transactions without significant limitations.
Between checking, savings, money market, and certificate of deposit, which typically has the highest interest rate? Which has the lowest liquidity?
Answer:
Certificate of Deposit (CD)
Explanation:
CDs often offer the highest interest rates among savings instruments, as they require funds to be deposited for a specific term. However, they have lower liquidity because accessing the money before maturity can incur penalties.
What are the three parts of the Federal Reserve System?
Answer:
1. Reserve Banks
2. Federal Open Market Committee
3. Board of Governors
Explanation:
The Federal Reserve System consists of various components that work together to achieve economic stability. Reserve Banks carry out the day-to-day functions, the Federal Open Market Committee makes monetary policy decisions, and the Board of Governors oversees the entire system.
List four possible fees associated with a checking account. Which is likely to be the highest?
Answer:
Overdraft fee, Account transfer fee, Monthly service fee, ATM fee. The ATM fee is the highest.
Explanation:
These fees can impact the overall cost of maintaining a checking account. Of these, ATM fees tend to be the most significant, especially if individuals frequently use ATMs outside of their bank’s network.
What are some unique features of a credit union?
Answer:
1. Credit unions are typically owned and run by their members.
2. Credit unions offer a wide variety of banking services.
Explanation:
This member-centric model allows credit unions to focus on serving their community and providing personalized financial services, often at lower costs compared to traditional banks.
What three things do the numbers on the bottom of a typical check represent?
Answer:
1. Routing Number
2. Account Number
3. Check Number
Explanation:
These identifying numbers help in processing and routing checks accurately. The routing number identifies the bank, the account number indicates the specific account, and the check number tracks individual transactions.
Which part of the check is the least important?
Answer:
Memo line
Explanation:
The memo line is optional and meant for personal notes or reminders about the payment. Unlike the other components, its absence does not affect the check’s validity or processing.
How often should you typically monitor your checking account?
Answer:
Monthly
Explanation:
Regular monitoring is essential to ensuring account accuracy, tracking spending, and detecting potential fraudulent activity. Monthly reviews help maintain financial awareness.
What is a payday lender? Why should you avoid them?
Answer:
They are not a type of bank but a type of loan. They’re very expensive, and your debt will grow fast.
Explanation:
Payday lenders often charge exorbitant interest rates and fees, which can lead to a cycle of debt. Borrowers may find it challenging to repay the loan when it is due, resulting in further financial strain.
How do you avoid paying ATM fees?
Answer:
Only use ATMs in your bank’s network.
Explanation:
By sticking to ATMs associated with your own bank, you can avoid additional charges that may arise from using out-of-network machines, keeping costs down.
What is the purpose of balancing or monitoring your checking account?
Answer:
Helps you calculate how much money you have in your account.
Explanation:
Regularly checking your account balance enables you to keep track of your finances, identify errors, and ensure that you do not overdraw your account.
What is the best way to ensure the accuracy and safety of your accounts?
Answer:
Monitor your accounts regularly.
Explanation:
Consistent monitoring helps catch discrepancies early and safeguards against unauthorized transactions, ultimately contributing to better financial security.
With a traditional savings account, there might be a fee for withdrawing money ______ ________.
Answer:
too often
Explanation:
Many savings accounts impose restrictions on the number of withdrawals you can make monthly. Exceeding these limits may incur fees, encouraging savers to keep their money untouched in the account longer.
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