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Chapter 1 PF test review Flashcards | StudBud
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Chapter 1 PF test review
Chapter 1 PF test review
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Questions
27
Answers
1
A loan shark will charge people reasonable interest rates.
True
False
2
Avoiding debt can lead to financial freedom and hope.
True
False
3
financial debts or obligations
assets
liability
4
Banks got into the credit business before 1920 because charging exceptionally high interest rates was legal.
True
False
5
anything that is owned by an individual, including money in the bank and investments
liability
asset
6
The percentage of principal charged by the lender for use of its money is ____.
interest
interest rate
7
The Five Foundations provide a simple ______ to help you win with money.
action plan
suggestion
guide for investing
8
Financial Literacy- knowledge and skill base necessary for people to be informed manage their finances effectively. T/F
False
True
9
The FIFTH Foundation is to ...
Hoard all of your money.
Build weatlh and give.
10
You should always make sure you have a ...
credit card
budget
11
an expression to describe people whose monthly income is devoted to expenses
Jolly Rancher
paycheck to paycheck
12
financial decisions an individual / family must make in order to earn, budget, save, spend, and give money over time
financial literacy
personal finance
13
What is FIRST Foundation?
open a checking account
pay cash for your car
pay cash for college
save $500 in an emergency fund
14
A financial plan allows a person to not only meet their immediate needs but also their long-term goals.
True
False
15
Almost half of Americans report having less than $1,000 in savings.
True
False
16
To be granted a loan or deferred payment of any type is called CREDIT.
True
False
17
Why is important to know your money personality?
Spenders specific goals they must follow.
Savers will be instant millionaires.
18
The additional cost a lender charges for borrowing their money.
interest rate
interest
19
A consumer is a person or organization that uses a product or service. TRUE or FALSE
False
True
20
What a person earns after payroll taxes and other deductions have been taken out of their paycheck is called net income.
True
False
21
Negative Net Worth is when your assets are well below your liabilities in monetary value.
True
False
22
Net Worth = Assets - Liabilities
True
False
23
Personal Finance is 20% behavior and 80% head knowledge. TRUE or FALSE
True
False
24
Positive Net Worth is when your assets far outweigh your liabilities in monetary value.
True
False
25
The percentage of Americans who are living paycheck to paycheck is almost 80%. T/F
True
False
26
Expenses are the cost of goods or services; money paid out.
False
True
27
money owed to another person or company
credit
debt
