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Personal Finance Chapter 1 Flashcards | StudBud
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Personal Finance Chapter 1
Personal Finance Chapter 1
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Keywords and concepts for chapter 1 Personal Financial Literacy
Flashcards
55 cards
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Questions
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Answers
1
Investment in the stock market
Liquid Asset
Debt
2
Buying a used car
medium-term goal
short-term goal
long-term goal
3
Financial information found on the Internet is always reliable.
True
False
4
What is Personal Financial Planning?
all of the financial issues that can affect an individual
all of the financial issues involved in borrowing money
all of the financial issues involved in saving money
the financial issues involved in spending within a budget
5
Financial planning is important no matter what type of education you plan to pursue.
False
True
6
You should be careful about evaluating financial planning advice from Web sites that
are trying to sell you a service
provide links to financial calculators
display employees' credentials
provide tips from a CFP
7
Which of the following is a long-term financial goal?
buying a cell phone
buying a house
creating an emergency fund
taking a vacation
8
If you have an understanding of personal financial planning you don't need a financial advisor.
True
False
9
A financial advisor's area of expertise should ________.
be independent
be broad
be narrow
match your needs
10
You should be more concerned with short-term financial goals than long-term financial goals
True
False
11
Bankruptcy is when you can't pay your debts and a(n) _____ takes over some of your finances.
financial advisor
court
investor
bank
12
A potential employer may check your credit history before offering you a job.
True
False
13
Calculating the opportunity cost of a purchase is a good way to consider the __of the purchase.
long-term effects
pros and cons
popularity
location
14
A rainy day fund is money set aside for ________.
long-term goals
charitable giving
short-term goals
unexpected emergencies
15
Knowledge of personal finance can help you define your goals.
False
True
16
Financial planning can affect the age at which you retire.
False
True
17
Purchase made on a credit card
Debt
Liquid Assest
18
The Internet can be a valuable source of information to use in personal financial planning.
True
False
19
Every time you decide to purchase something, you incur an opportunity cost.
True
False
20
The purpose of insurance is to ________ your assets.
protect
expand
finance
manage
21
CPA stands for ________.
Communication Professionals Association
Community of Professional Accountants
Certified Public Accountant
Certified Professional Accountant
22
Understanding the opportunity costs of your purchases will likely help you think about changing
educational plans
study habits
retirement plans
spending habits
23
Which of the following is and example of a liquid asset?
the paycheck that you will receive in two weeks
your checking and savings accounts
your credit card
your leased car
24
Saving for a down payment is most closely associated with which of the following long term goal
retiring early
buying a house
going to college
giving to charities
25
Planning for retirement
short-term goal
long-term goal
medium-term goal
26
Only a small percentage of Americans working full-time live paycheck to paycheck.
False
True
27
Which of the following is NOT a financial goal?
making charitable donations
establishing an emergency fund
retiring at an early age
enjoying your career
28
A savings account that earns interest
Liquid Asset
Debt
29
Mortage
Liquid Asset
Debt
30
If you make and follow a good financial plan, you are likely to have more financial flexibility
True
False
31
Owen wants to use a payment calculator to find out what range of car loans he can afford.
the Internet
a financial advisor
32
Planning your spending, borrowing, and saving are all aspects of
financial advising
asset management
personal financial planning
credit management
33
In comparison to other long-term financial goals, raising a child is relatively inexpensive.
True
False
34
Which of the following is NOT an important question to ask when selecting a financial advisor?
Do I feel comfortable with the advisor?
Can the advisor provide references from satisfied customers?
Does the advisor have personal plans to retire early?
Does the advisor have a relevant certification?
35
Ellie wants to monitor the performance of a stock that she just purchased.
the Internet
a financial advisor
36
buying an outfit for prom
short-term goal
medium-term goal
long-term goal
37
Attending Community College
short-term goal
long-term goal
medium-term goal
38
It is impossible to plan for an unexpected loss in wages
True
False
39
The ______ you begin saving , the _______money you have to set aside on a regular basis.
earlier; less
earlier; more
later; more unpredictable the amount of
earlier; more unpredictable the amount of
40
The best time to start investing money to reach your financial goals is ________.
in your thirties
in your twenties
now
in your forties
41
When is the best time to start saving for long-term financial goals?
after you have finished college
when you are young and have fewer financial obligations
when you are in your forties and earning more money
when you have a family of your own
42
A financial advisor will likely have a better understanding of ________ than you do.
goal-setting
dangers posed by the Internet
people skills
tax laws
43
What does the opportunity cost of a purchase tell you?
purchase plus the interest paid on credit for the purchase
purchase plus cost of not doing or purchasing something else
the cost of the purchase plus the cost of sales tax
44
Because of the dangers posed by the Internet, you should ________ for financial planning.
cautiously use it
never use it
rarely use it
freely use it
45
buying an MP3 player
long-term goal
short-term goal
medium-term goal
46
Adults with which of the following levels of education make the highest annual income?
associate's degree
master's degree
high school diploma
bachelor's degree
47
Good financial decision-makers use the same basic tools to plan for their Personal Finance.
True
False
48
Part of financial planning is thinking about and planning for unexpected expenses.
False
True
49
Different levels of education have both financial and time costs that you should consider.
False
True
50
Entrepreneurs do not need financial planning to be successful.
True
False
51
In general, the more education you have, the ________ your ________.
lower; debt
higher; salary
higher; debt
lower; salary
52
Good financial decision-makers all use the same thought process to make plans.
False
True
53
After inheriting a large sum of money, Aurora needs help completing and filing out her taxes.
the Internet
a financial advisor
54
buying a home
long-term goal
short-term goal
medium-term goal
55
At this stage of your life, it is ________ to think about your retirement.
unnecessary
beneficial
too difficult
absolutely necessary
