Banking Language

Name:

Date:

Instructions: Explore the specialized vocabulary of the banking and finance industry with these engaging questions.

1.
What is a 'certificate of deposit' (CD)?
A
A type of checking account
B
A receipt for a bank wire transfer
C
A document proving you own stocks
D
A time deposit with a fixed interest rate and maturity date
2.
What does 'APR' stand for in banking?
A
Approved Payment Request
B
Annual Percentage Rate
C
Automatic Payment Return
D
Applied Principal Rate
3.
What is a 'fiduciary'?
A
A government bank examiner
B
A type of bank teller
C
A financial software program
D
A person or institution legally obligated to act in another's best financial interest
4.
What does 'collateral' mean in banking?
A
Interest earned on savings
B
A co-signer on a loan
C
An asset pledged as security for a loan
D
A secondary bank account
5.
What is a 'maturity date' on a financial product?
A
The date the bank was founded
B
The date your credit card expires
C
The date when a loan or investment reaches the end of its term
D
The date you opened the account
6.
What does 'FDIC' stand for?
A
Federal Department of Investment Control
B
Federal Deposit Insurance Corporation
C
Funds Distribution and Investment Committee
D
Financial Data Information Center
7.
What is 'compound interest'?
A
Interest calculated on both the initial principal and the accumulated interest from previous periods
B
Interest charged only on the original principal
C
Interest paid only at year-end
D
A fixed interest rate that never changes
8.
What does 'underwriting' mean in banking?
A
Signing the bottom of a document
B
A type of bank endorsement
C
Writing checks below the line
D
The process of evaluating and assuming risk, especially for loans or insurance
9.
What is a 'wire transfer'?
A
A physical transfer of coins
B
An electronic transfer of funds between financial institutions
C
Sending a telegram to a bank
D
Connecting bank computers with cables
10.
What does 'amortization schedule' show?
A
A bank's operating hours
B
A table showing each loan payment broken down into principal and interest over time
C
A list of bank holidays
D
The schedule for opening new branches
11.
What is a 'line of credit'?
A
A flexible loan arrangement allowing borrowing up to a preset limit
B
A queue at the bank
C
A written reference from a bank
D
A credit card number
12.
What does 'principal' refer to in a loan?
A
The original amount of money borrowed, excluding interest
B
The interest rate
C
The monthly payment amount
D
The bank manager
13.
What is 'overdraft protection'?
A
A safe in the bank vault
B
Insurance against bank robbery
C
A service that covers transactions when your account balance is insufficient
D
A type of savings account
14.
What does 'yield' mean in banking?
A
Giving way to another customer
B
The income earned on an investment, expressed as a percentage
C
A type of security measure
D
The number of accounts at a branch
15.
What is a 'promissory note'?
A
A written promise to pay a specified sum of money on demand or at a future date
B
A bank's advertising flyer
C
A note attached to a safety deposit box
D
A thank-you letter from a bank

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