Which financial advisor is recommending a long-term investment that lowers investment risk?

Advisor C: “Invest in mutual funds.”

A person with a job had a baby. She is able to increase her paycheck by

Adding the baby to her payroll exemptions (allowance)

A person with renter’s insurance can submit a claim on her policy if

Her television is stolen from her apartment

As a result of putting a “stop payment” on a check, a person will

Have to pay a fee for the service

Why do financial advisors warn people against taking payday loans?

These loans often result in a pattern of continued borrowing

One advantage of having a bank savings account is that it

reliable way to earn interest & establish personal fin. hist

If a person believes that he is a victim of identity theft, he must

File a report with the police and get a copy of the report

A person receives health insurance. He/she has a $15 ins. co-pay. When they visit their doctor

Person is responsible for $15 regardless of cost of visit

A person who pays the minimum balance due on a credit card bill will

Be charged interest on the unpaid balance.

When using a debit card, a person should

Immediately record debit card purchases in chkbk register

When applying for a loan, the higher a person’s credit score/rating the

Lower the interest rate will be for the loan

Bankruptcy allows a person to erase all of the following debts EXCEPT for

Income taxes and child support payments

Why would a person put a stop payment on a check?

To prevent anyone from cashing a check thats lost or stolen.

The Rule of 72 helps a person determine the

# of years it takes to double money at a given interest rate

A stock is characterized as a “growth” stock because the expectation is for the corporation to

Have significant increase in sales and earnings

The reason that a person should AVOID making a check payable to “cash” is that

Anyone can cash the check if it is stolen

Why do investors buy stocks that pay dividends?

Investors receive payments from the company during the year

Who suffers the LEAST when the rate of inflation increases?

People who have a loan with a fixed-interest rate

Bank customers can use an ATM to

Transfer money between checking and savings accounts

Why are collectibles, such as old coins, considered a risky investment?

Finding buyers can be made is often difficult

One DISADVANTAGE of using a non-bank ATM in a store is that a person

May be charged an ATM fee for the withdrawal

What is a good strategy to build wealth for the future?

Deposit money into both savings & nvestment accounts monthly

The Federal Reserve System (fed) helps protect depositors and its member banks by setting

Required amt.of $ member bank must have on deposit

Why does a person renting an apartment buy renters insurance?

To protect her personal property in case of fire or theft

It is usually a good idea to borrow for

Something that increases in value over time

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Walker W!SE REMEDIATION 1

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Wise Remediation #Certified

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Questions 45

Answers

1
Which is the best lifetime investment?
Gold
Insurance
Real Estate
Education
2
Which financial advisor is recommending a long-term investment that lowers investment risk?
Advisor C: “Invest in mutual funds.”
Advisor D: “Invest in speculative stock.”
Advisor B: “Purchase a computer.”
Advisor A: “Purchase a used car.”
3
Which is the most difficult budget item for a person to change?
Discretionary income
Monthly savings
Fixed expenses
Variable expenses
4
The reason corporations issue bonds is to
Borrow money from investors
Encourage Americans to save
Increase the number of their customers
Increase their employee salaries
5
What action will help a person the MOST to make investment decisions?
Read advertisements on the internet
Open a brokerage account
Create financial goals
Ask friends about their investment.
6
A person with a job had a baby. She is able to increase her paycheck by
Opening a savings account for the baby.
Applying for her baby’s social security number.
Increasing money contributed to her pension.
Adding the baby to her payroll exemptions (allowance)
7
The most important factor when applying for a credit card is the
Annual Percentage Rate (APR)
Color of the card
Annual deductible
Rate of inflation
8
A person with renter’s insurance can submit a claim on her policy if
She needs to be hospitalized
She is involved in a car accident
Her television is stolen from her apartment
Her monthly rent on the apartment is more than $500
9
As a result of putting a “stop payment” on a check, a person will
Be asked to close his checking account
increase the minimum balance required for the account
Have to pay a fee for the service
Not be able to use his debit card
10
Why do financial advisors warn people against taking payday loans?
The loans are often from unlicensed lenders
Employers wont pay for med. insurance until the loan is paid
A persons salary cannot be increased until the loan is paid
These loans often result in a pattern of continued borrowing
11
One advantage of having a bank savings account is that it
reliable way to earn interest & establish personal fin. hist
Guarantee depositors interest-free loans
Protects from paying charges/latefees on other bank accounts
Offers depositors higher interest rate on U.S savings bonds.
12
If a person believes that he is a victim of identity theft, he must
File a report with the police and get a copy of the report
Avoid discussing the situation
Destroy his debit card monthly statements
Rent a safety deposit box at a bank and store his valuables
13
A person interested in earning investment income is generally advised to buy stocks that pay
Premiums
Dividends
Awards
Interest
14
A person receives health insurance. He/she has a $15 ins. co-pay. When they visit their doctor
Person will only be covered for $15 toward the cost of visit
Person is responsible for $15 regardless of cost of visit
Doctor will charge the person’s ins. co. $15 for the visit
Doctor will deduct $15 from the person’s bill
15
A person who pays the minimum balance due on a credit card bill will
Be charged a fixed fee for having an unpaid balance
Have interest charged on all of his credit card accountsd.
Be charged interest on the unpaid balance.
Get an increase in the annual fee for using the card
16
When using a debit card to buy something, where does the money come from
The U.S. Treasury Department
A stock account
A checking account
A certificate of deposit
17
When using a debit card, a person should
Know that she has 30 days to pay for purchases made w/debit
Keep the card personal identification number (PIN) in wallet
Check monthly credit card stmnt to verify debit activity
Immediately record debit card purchases in chkbk register
18
What needs to be included in a will?
Where the will is to be read
The cause of death
The name(s) of beneficiaries
person’s monthly budget
19
When applying for a loan, the higher a person’s credit score/rating the
The higher the interest rate will be for the loan
Longer the payment period will be for the loan
Lower the interest rate will be for the loan
Shorter the payment period will be for the loan
20
A person generally pays a lower interest rate on a car loan than on a personal loan because the
Car is collateral for the loan
Price of new cars increase each year
Car is insured
Loan on the car requires a cosigner
21
Bankruptcy allows a person to erase all of the following debts EXCEPT for
Income taxes and child support payments
Past due rent and car loans
Doctors’ fees and hospital charges
Credit card charges and installment loans
22
Why would a person put a stop payment on a check?
To prevent anyone from cashing a check thats lost or stolen.
The payee does not have a checking account.
To avoid paying a fee for a lost check.
To close the checking account.
23
What phrase is used for putting money into a savings account?
Making a deposit
Balancing the account
Verifying the account
Making a withdrawal
24
The Rule of 72 helps a person determine the
Amount of life insurance needed to protect a person’s family
# of years it takes to double money at a given interest rate
Amount of money needed to pay for emergencies
Yearly inflation rate
25
The U.S. Treasury Department is responsible for
Preparing tax returns.
Clearing checks.
Training financial advisors.
Printing money.
26
A likely consequence of failing to pay a car loan is
An increase in taxes withheld each pay period
A new loan for a longer repayment period
An interest rate increase on another loan she has
Repossession by the lender
27
A stock is characterized as a “growth” stock because the expectation is for the corporation to
Pay a higher rate of interest monthly
Issue bonds to investors
Have significant increase in sales and earnings
Provided shareholders with dividends
28
The reason that a person should AVOID making a check payable to “cash” is that
The only place the check can be cashed
The check can only be cashed by the person who wrote it
Anyone can cash the check if it is stolen
Checks written to cash can only be written for under $100
29
Why do investors buy stocks that pay dividends?
The price is generally lower
Investors are allowed to buy company products at a discount
They stock price will not change
Investors receive payments from the company during the year
30
Who suffers the LEAST when the rate of inflation increases?
People who need to borrow money
People who buy goods and services with credit cards
People who are unemployed
People who have a loan with a fixed-interest rate
31
A financially literate person invests & makes donations by using money thats left after paying
In his emergency fund
From is Roth Individual Retirement Account (IRA)
his budgeted monthly expenses
From his pay day loans
32
Bank customers can use an ATM to
Transfer money between checking and savings accounts
Buy mutual fund, stocks, treasury notes and bonds.
Change their credit history
Apply for car loans
33
Why are collectibles, such as old coins, considered a risky investment?
Its necessary to have several copies of each coin
Building a large collection is difficult
Finding buyers can be made is often difficult
Collecting coins is a popular activity
34
Which is NOT a mandatory deduction from a person’s salary?
State Income Tax
401(k) contribution
Social Security (FICA)
State Unemployment Insurance/State Disability Insurance
35
The cost of car insurance is affected by the
Kind of car owned
Number of times the car has been serviced
Type of gas the care requires
Expertise of the car salesperson
36
When determining the dollar value of a job offer which benefit should not be included?
Sick days
A private office
Tuition reimbursement
Vacation days
37
One DISADVANTAGE of using a non-bank ATM in a store is that a person
May be charged an ATM fee for the withdrawal
Will not receive a record of money withdrawn from the ATM
Must pay interest on the money withdrawn from the ATM
Must withdraw at least $50 from the ATM
38
Subtracting total dollar amount you owe from the total dollar amount you own, tells you your
Liabilities
Liquidity
Portfolio value
Net worth
39
The stock market is rising, investors expect stock prices to continue rising, is described as a
Volatile market
Bear market
Stable market
Bull market
40
The government taxes cigarettes in order to raise revenue and to
Encourage tobacco growing
Provide money to small store owners
Discourage smoking
Pay for product advertising in the U.S.
41
What is a good strategy to build wealth for the future?
Have paychecks automatically deposited in a checking account
Deposit money into both savings & nvestment accounts monthly
Pay for goods and services using credit cards
Pay bills when received and use a checking account
42
The Federal Reserve System (fed) helps protect depositors and its member banks by setting
Limits on the number of depositors a member bank may have
Limits on how many branches a member bank can have
Requirement where member bank advertise products & services
Required amt.of $ member bank must have on deposit
43
Why does a person renting an apartment buy renters insurance?
To protect her personal property in case of fire or theft
To lower her monthly rent
To provide income in case she becomes disabled
To meet federal rent laws
44
It is usually a good idea to borrow for
Something that increases in value over time
Anything that will make the person happy
The amount needed to pay bills each month
Anything if the interest rate is low
45
The best way to ensure a high credit score is to
Have a high unpaid credit card balance.
Invest in speculative stocks.
Make loan payments on time.
Graduate from college.

Walker W!SE REMEDIATION 1 Flashcards | StudBud