When an investor buys a zero-coupon bond, the investor

purchases bond at a discount from the face value of bond.

Brian opened checking account & getting written bank statement monthly & not cancelled checks.

save the bank money associated w/ returning copies of checks

Person having dispute regarding unfulfilled building contract, case will go to mediation means:

neutral third party will hear both sides and try to resolve

Which statement is FALSE about most ATM (Automated Teller Machine) cards?

You can always get cash anywhere in the world with no fee.

In which situation is a corporation most likely to call (buy back) a bond?

Co.issued bonds @ 7.5% interest, current bonds issued @ 5%

Which best describes relationship between person's educational level & potential earning power?

professional degrees earn 4X as much yearly as highschool

The cost to use someone else's money for a period of time is called the:

Interest rate expressed as a percentage

A person places $1,000 in an investment that is considered a tax shelter. The person can expect

immediate tax benefits from the investment.

The best suggestion you gave a friend who is writing a check for the first time is:

Date the check because it is usually proof of payment

Which of the following is necessary for successful budgeting?

The ability to adjust spending to money available

Employees prefer direct deposits because:

money generally deposited in checking sooner than in person

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Money Power Hard- All categories

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Questions 20

Answers

1
When an investor buys a zero-coupon bond, the investor
receives the interest in a lump sum when the bond matures.
purchases bond at a discount from the face value of bond.
is buying a series of bonds that mature at different times.
agrees to obtaining a bond with a variable interest rate.
2
Judi & Phil had joint VISA credit card while married. Now divorced, who is responsible?
Neither Phil nor Judi because they are now divorced
Both Judi and Phil
Phil since he is has a full time job
The credit card company
3
Student's grandmother decided to buy a long term health care insurance policy. This coverage
pays for prescription drugs.
provides life-insurance benefits to heirs
allows extension of in-hospital acute care days.
is not offered by Medicare
4
Brian opened checking account & getting written bank statement monthly & not cancelled checks.
protect him from providing opportunities for forgery.
insure he does not receive important materials he may lose
lessen bank's need to maintain records of check transactions
save the bank money associated w/ returning copies of checks
5
Person having dispute regarding unfulfilled building contract, case will go to mediation means:
neutral third party will hear both sides and try to resolve
the judge and jury will decide who is right in court.
the dispute will be handled in small claims court.
each party involved must agree in advance to accept outcome
6
Which statement is FALSE about most ATM (Automated Teller Machine) cards?
You can always get cash anywhere in the world with no fee.
Must have account w/a financial institution to have ATM card
You can obtain info concerning account balance @ ATM machine
You can generally get cash 24 hours a day, 7 days a week.
7
Which product is considered to be an investment?
An initial public offering of stock
A certificate of deposit
A new car
A corporate bond
8
In which situation is a corporation most likely to call (buy back) a bond?
It wants to diversify its public offerings.
Its stock prices has fallen from $52 to $20 a share
It is planning to issue more stock.
Co.issued bonds @ 7.5% interest, current bonds issued @ 5%
9
Which of the following will help you the LEAST in managing your money?
set goals and keep a budget for your net income
plan for large expenses shop w/ list & resist impulse buying
pay your rent/mortgage payment and utility bills on time
get advice from your friends
10
Which best describes relationship between person's educational level & potential earning power?
Higher education level decreases potential earning
Education has no effect on a person's potential earning powe
Higher education level affects earning only for people 40+
professional degrees earn 4X as much yearly as highschool
11
The cost to use someone else's money for a period of time is called the:
Interest rate expressed as a percentage
Inflation rate
Minimum payment
Opportunity cost
12
A person places $1,000 in an investment that is considered a tax shelter. The person can expect
the cost of the investment to be a tax deduction
the interest earned on the investment to be tax deferred.
immediate tax benefits from the investment.
the cost of the investment to be deducted from gross income.
13
When securities are traded in the secondary market, who makes or loses money?
Investors
Creditors
Small businesses
The SEC
14
The best suggestion you gave a friend who is writing a check for the first time is:
Use stub/register to keep record of the date you writecheck
Use pencil to permit changes
Make the check payable to cash
Date the check because it is usually proof of payment
15
Joi lost debit card did not report it missing for 3 mo, If used by otherperson max liability is
$50
Unlimited liability
No liability because she notified the financial institution
$500
16
Which of the following is necessary for successful budgeting?
A list of unexpected income
The location of your banks
The ability to adjust spending to money available
A copy of credit card report
17
Employees prefer direct deposits because:
money generally deposited in checking sooner than in person
Direct deposits earn a higher rate of interest
The danger of losing a paycheck is slightly reduced
There is a small fee for the service
18
Buying a treasury bill (T-bill) is best for investors who are looking for
higher yield on their investment than corporate bonds offer.
an investment that matures in 10-30 years.
a place to invest between $100-$500.
a secure, low risk investment.
19
When the market has a steady decline in stock prices over a period of time, it is known as a:
Bear market
Bull market
Risky market
Fluctuating market
20
To determine time value of depositing $100 in savings account person needs interest rate &
the rate of inflation.
her total income
whether the bank offers overdraft protection.
whether the account is FDIC protected.

Money Power Hard- All categories Flashcards | StudBud