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EPF - FINAL EXAM REVIEW Flashcards | StudBud
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EPF - FINAL EXAM REVIEW
EPF - FINAL EXAM REVIEW
50 terms
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Questions
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Answers
1
What is a cycle of debt?
A cycle of consistently paying off debt on time
A cycle of never accumulating any debt
A cycle of accumulating more debt due to high-interest rates and fees
A cycle of always having a high credit score
2
What is one benefit of owning a property?
Flexibility to move to a new location w/o the burden of selling a property
No need to worry about property maintenance and repairs
Lower monthly payments than owning
Build equity over time and generate wealth through property appreciation
3
A company has experienced a decline in profitability over the past year. Which is the most likely cause?
Increased demand and higher prices
An increase in the cost of raw materials
A natural disaster disrupting the supply chain
Lower demand and lower prices
4
What variables should income and spending plans be uniquely tailored to that change throughout life?
An individual's age and needs
An individual's income
An individual's available resources
An individual's financial goals
5
Command Economy Meaning?
one in which someones central authoirty to an item
one in which a central authority decides what goods will be produced
none of the above
one in which someones central authority
6
Which of the following typically corresponds with an increase in the unemployment rate?
A period of stable economic growth
A period of economic contraction
A period of low inflation
A period of economic expansion
7
How does housing impact your quality of life and financial goals?
It can be a significant financial burden if not managed properly
It has no impact on your financial goals
It provides opportunities for financial security
It provides a comfortable and safe living environment
8
What factors are considered when calculating the FICO score?
Payment history, amounts owed, length of credit history, types of credit
Education level, marital status, and number of children
Age, income, and job history
Physical fitness and health history.
9
What is the purpose of allocating funds to each financial goal in creating a spending plan?
To create a budget
To determine how much money you have left over for discretionary spending
To prioritize your financial goals based on importance
To monitor and adjust your spending plan
10
What is a potential drawback of balloon mortgages?
The interest rate can fluctuate over time
Higher interest rates than other mortgage types
Borrower must pay off the remaining balance at the end of repayment period
Lower monthly payments during the repayment period
11
The basic economic problem of scarcity involves...
unlimited wants and limited resources
unlimited incomes and limited spending
unlimited wants and limited money
unlimited resources and limited wants
12
What are some of the main goals of government regulation in the marketplace?
To promote overall economic stability and protect businesses
To promote competition and protect consumers
All of the above
To protect property rights and enforce contracts
13
How does trade dependence affect a country's economy in times of economic crisis?
It has no impact on the country's economy in times of economic crisis
It makes the country's economy more vulnerable to economic crisis
It makes the country's economy more resilient to economic crisis
It improves the country's relations with other countries.
14
Which financial incentive involves giving employees a % of money based on the value of sales they make?
Piece Rate
Commission
Overtime
Salary
15
What is one drawback of renting?
Locked into one location for years
Large upfront costs
Need to worry about property taxes
Rent payments are an ongoing expense that does not build equity
16
What type of expenses can vary greatly depending on the post-secondary institution?
Transportation
Room and board
Personal expenses
The Cost of Books
17
What does an increase in Gross Domestic Product typically indicate?
A period of unstable economic variation
A period of economic expansion
A period of economic contraction
A period of high inflation
18
How can responsible debt management help individuals?
By decreasing credit scores and limiting access to credit
By increasing interest rates and fees
By limiting investment opportunities
By building credit scores and increasing access to credit
19
Which of the following typically occurs during a period of economic expansion?
A rise in the unemployment rate
A decrease in production and sales
An increase in production and sales
An increase in the inflation rate
20
How can government regulations negatively impact businesses?
By increasing administrative costs and paperwork
By promoting competition
By increasing profits
By providing additional financial assistance
21
The point on a supply and demand graph where supply meets demand is known as...
Point Squared
X
The money spot
Equilibrium
22
How is the amount of property tax and/or Estate tax determined?
By the size of the property
By the income of the property owner
By the number of people living in the property
By the assessed value of the property
23
Which of the following is a benefit of having insurance in a financial plan?
It eliminates the need for emergency savings
It allows for tax-free withdrawals in retirement
It guarantees a fixed rate of return on investment
It helps protect against unexpected expenses and losses
24
What is the main goal of reallocating resources in the economy through government policies and programs?
To increase the wealth of the rich
To decrease the wealth of the poor
To promote efficiency, equity, and economic growth
To decrease the size of the government
25
What is the function of the opportunity cost ?
To evaluate different investment alterns
To help the government with its debts
To show how much are you earning
To demostrate business profits
26
The economies of varying countries often vary from each other because they have different
governments
Geography and resources
languages and cultures
origins and religions
27
What are insurance premiums?
Amounts paid to maintain insurance coverage
Amounts paid to maintain retirement savings
Amounts paid to maintain Social Security benefits
Amounts paid to maintain tax credits
28
What are taxes used for by the United States government?
To provide for infrastructure and public services
To increase the wealth of the government
To punish the wealthy
To decrease the wealth of the population
29
What affects an individual's desired lifestyle?
Income
Education
All of the above
Career
30
Which payment method can help build credit scores if used responsibly?
Debit Cards
Credit Cards
Payment Applications
Cash
31
Which is an example of the Federal Trade Commission (FTC) protecting consumers from deceptive business practices?
Enforcing stricter regulations on banks and financial institutions
Approving the release of a new medication to treat a specific illness
Regulating the price of goods and services in the market
Suing a company for falsely advertising their weight loss supplement
32
How does a good work-life balance impact life and financial goals?
No impact, as job security and career advancement are more important
It allows you to focus on both equally, leading to a more fulfilling life
It has no impact on quality of life as long as you have high income
It can limit your earning potential, making it harder find happiness
33
What is the purpose of pre-tax deductions?
To reduce an employee's taxable income
To increase an employee's taxable income
To increase an employee's tax bill
To have no impact on an employee's taxable income
34
What is the first step in establishing financial goals?
Researching financial products and services
Setting a specific timeline for achieving goals
Identifying financial needs and wants
Assessing risk tolerance
35
Why is a MBA recommended for individuals who want to lead a creative and entrepreneurial lifestyle?
It trains individuals in engineering and technology
It provides the necessary knowledge and skills to start & manage a business
It provides training in fine arts and design
It prepares individuals for a career in writing fiction
36
What is the primary purpose of excise taxes?
To fund specific programs
To tax individuals' wages or salary
To tax the profits of corporations
To tax specific goods or services for specific programs
37
What is the main force of supply and demand?
Economic System
Demand
Profit
Competition
38
Which is an example of the Food and Drug Administration (FDA) regulating the market to protect public health?
Enforcing air quality regulations
Regulating financial markets
Protecting consumer rights
Approving the release of a new medication
39
Which of the following is an example of the Small Business Administration (SBA) providing support for small businesses?
Investing in large corporations
Enforcing stricter regulations on banks and financial institutions
Providing loans to small businesses affected by natural disasters
Regulating the stock market and protecting investors
40
Which of the following programs may be funded by excise taxes on tobacco?
Healthcare
Education
Road maintenance
Law enforcement
41
Which of the following is typically used to calculate sales tax?
The color of the item being purchased
The number of items being purchased
The percentage of the sale price
The weight of the item being purchased
42
What is the main purpose of networking?
To get a better education
To improve financial knowledge
To build relationships and exchange resources and opportunities
To increase earning potential
43
Which payment method can be difficult to pay off and can lead to a cycle of debt?
Debit Cards
Cash
Credit Cards
Payment Applications
44
What is the primary goal of central banks when it comes to the inflation rate?
To increase the purchasing power of consumers
To stimulate economic growth
To maintain a high, unstable inflation rate
To maintain a low, stable inflation rate
45
Which of the following organizations may play a role in economic stabilization efforts?
Political parties
Business organizations
Environmental groups
Lobbiest
46
What is the key difference between a recession and a depression?
Recessions last longer
Depressions are more common
Depressions are more severe and last longer
Recessions have higher levels of unemployment
47
When the price of gasoline goes up, what will the airlines do to continue to earn a profit?
Decrease the number of seats on the airplanes
Decrease the prices of tickets
Increase the pay of their employees
Increase the prices of tickets
48
What is the tax implication of holding stocks for more than one year under the buy and hold strategy?
Subject to short-term capital gains taxes
Higher tax rates than short-term capital gains taxes
Exempt from capital gains taxes
Subject to long-term capital gains taxes, which are lower than short-term
49
How can volunteering your time benefit individuals?
It can improve their mental and physical health
It can improve their job prospects
It can improve their social status
It can provide a source of income
50
What type of post-secondary education typically has the highest expenses?
Four-year university
Trade school
Online program
Community college
