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