1. Chapter 5 Vocabulary Review
Personal Finance
Chapter 5 Vocabulary Review

2. A bank card that lets the owner make purchases from an ATM
Debit card

3. Money electronically added to an account; no currency or paper checks are involved
Automatic deposit

4. Interest that is earned on both principal and interest previously earned on savings
Compound interest

5. Money deducted from an account and electronically transferred to another person
Automatic withdrawal

6. A demand deposit that allows the account holder easy access to the money and allows checks to be written on the account
Checking account

7. A check that is returned by the bank for non-sufficient funds; also called a bad check
Bounced check

8. A record in which transactions of a checking account are kept
Checkbook register

9. A check issued by the bank against bank funds
Cashier’s check

10. A written order to a bank to pay the stated amount to the person or business named on the check from a certain account
check

11. A deposit of money set aside for a fixed amount of tie at a fixed interest rate
Certificate of deposit (CD)

12. A bank service that directs the bank not to honor a check you wrote or lost
Stop payment

13. Money added to a checking, savings, or other account
deposit

14. A demand deposit that has some restrictions as to how quickly or easily you can get your money
Savings account

15. The rate banks are charged to borrow money from the Federal Reserve
Discount rate

16. A math formula that calculates how long it will take for money earning a set rate of interest to double
Rule of 72

17. A signature or instructions written on the back of a check authorizing a bank to cash or deposit the check
endorsement

18. An amount of money that is set aside (saved or invested) on which interest is paid
principal

19. The rate at which banks can borrow money from the excess reserves of other banks
Federal funds rate

20. The interest rate that banks charge to their most creditworthy business customers, such as corporations
Prime rate

21. Actions taken by the federal reserve to influence money and credit conditions in the economy in an effort to affect employment levels and prices
Monetary policy

22. A check written with a date that will occur in the future
Postdated check

23. A type of prepaid check that directs payment of a sum of cash to a payee
Money order

24. A discount savings bond issued by the US government
US Savings Bond