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Consumer Finance Midterm Review Flashcards | StudBud
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Consumer Finance Midterm Review
Consumer Finance Midterm Review
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This Quiz is designed to test the knowledge of consumer finance for high school students.
Flashcards
45 cards
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Practice quiz
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Questions
45
Answers
1
ETFs are _________________________________________.
There is no such thing!
Like a mutual fund, but traded liek a stock
like an trust, but traded by NAV
Electronically Transferred Funds
2
Rising costs in the marketplace that reduce the future value of money are what type of risk?
Market risk
Interest risk
Inflation risk
Business failure risk
3
ADB is __________.
A method for calculating interest charges
A method of calculating your annual diversified balances
A method of calculation for your annual debit balances
A member of the Wu-Tang Clan
4
The term for interest that your accounts earn each year is ______________________.
Percent of Interest Per Year (PIPY)
Annual Rate Earned (ARE)
Annual Percent Yield (APY)
Yearly Interest Paid (YIP)
5
The lowest price at which a seller is currently willing to sell the stock:
Volume
Ask
Bid
Beta
6
Participation certificates are considered what category of investment?
Indirect, moderate to low risk.
None of the other answers are correct.
Direct, and highly illiquid.
High yield, high risk.
7
Passive income refers to income that
is taxable at a higher rate.
is generated from certain types of investments.
can't be withdrawn until retirement.
is generated from your work or other endeavors.
8
What are the three main categories of assets people acquire?
Direct, indirect, and virtual
Fiduciary, non-Fiduciary, and Commercial
Real, financial, and intangible
Liquid, illiquid, and fungible
9
Which of the following would be considered an ADU?
A pool house used for entertaining
A finished room over a garage (FROG)
A home office
An ETF that holds Agricultural and domestic dwelling based securities
10
Market Cap is used to reference
The cap on stock sales for an individual company
The capacity for market profitability or loss
The aggregate value of an organization’s outstanding stock
The total value of a company’s market share
11
Depreciation represents _________________.
how much value something provides to its owner.
how much of something's value is left.
the market value of a liquid asset.
how much of something’s value has been used up.
12
Common securities that pay dividends are _______________________.
never really worth the cost of adding to your portfolio
utility companies, REITs, and telecommunication companies.
guaranteed sources fo income
tech companies like Apple and Microsoft
13
When you buy common stock, you are buying shares of a ______.
Exchange Traded Fund
Corporation
Mutual Fund
REIT
14
The investigation that a reasonable person is normally expected to take before entering into an agreement.
A prospectus
Due diligence
Fiduciary responsability
Stock analysis
15
What fund would be considered a diversified mid- to long term holding for income?
Multi cap
High cap
Small cap
Mid cap
16
NAV stands for:
Net Allowable Variance
Negative Asset Valuation
Negative Allocation Value
Net Asset Value
17
Mortgage Backed Security (MBS) investments are exposed to a multitude of risks like ________________.
inerest and business risks
leverage and debt to equity risks
fiduciary and political risks
stock market and moon phase risks
18
An investment in which the owner holds legal title to a security or property.
Direct investment
Intangible investment
Liquid investment
Indirect investment
19
This indicates the number of shares that have traded hands today:
Ask
Volume
Bid
Beta
20
We learned about Small, Mid, and Large Cap Funds. Which one is the least risky?
Large Cap
Small Cap
Cap size has nothing to do with risk
Mid Cap
21
What is a collection of investments called?
An Income Statement
A Fund
A Portfolio
A Budget
22
How is
wealth
generated from stock holdings?
Through sales
Through increased market capitalization
Through increased revenue and dividends
Through splits and growth over time
23
ROI stands for
Return of the Iguanas.
Return on Insufficiencies
Returns on Instability
Return on Investment
24
Intangible assets are the valuable property that is not physical in nature. They include:
Indirect real estate, rental properties, and collectible cars
Crypto currency, NFTs, and gold bullion
Pokemon cards, Baseball memorabilia, and crypto mining servers
Patents, trademarks, and intellectual property
25
_____ is used to measure the volatility of a stock as compared to the market as a whole.
Ask
Bid
Beta
Volume
26
An example of an
investment
that has risk is ______.
a single family rental home
a diamond ring
a collection of action figures
a new Corvette
27
_________ refers to state of an asset that can easily be sold or exchanged for cash.
Illiquid
Liquid
EPS
Saleable
28
The market value of an owner's
unencumbered interest
in something:
owner's equifax
institutional equity
owner's equity
owner's liability
29
Exchange traded funds are considered __________________________.
high risk, income or value securities
low risk, income or value securities
low risk, income only securities
high risk, wealth only securities
30
Indirect real estate investments include:
POCs, PCs, REITS
Mutual Funds and ETFs investments
MOPs, STOPs, and REINs
Commercial property
31
Closed Ended or Secured credit is most commonly held by consumers in the form of
Credit cards
Car loans and mortgages
Personal loans
Store cards like a Target credit card
32
Terms and Conditions refer to _________.
The end user license agreement for a financial institution
The interest rates you’ll earn from credit cards
The interest rate for a loan or credit card contractual agreement
The particular fees and repercussions defined in a financial contract
33
Most experts recommend keeping your overall credit card utilization below 25%
True
False
34
Your debt to income ratio can impact your ability to __________.
None of those are correct
Obtain secured credit lines
Qualify for competitive interest rates
Negotiate contract terms and conditions
35
When someone rents a property from you, they are referred to as a ______________.
Occupant
Business Partner
Customer
Tenant
36
With the Five C’s of Credit, Character refers to:
Capital you can put toward a potential purchase
Your reputation
Your ability to repay a loan
Your history of using credit - types and time
37
Diversity in investments means you have ____________________________.
shares of beef cattle commodities and McDonalds
stock holdings in both McDonalds and Burger King
guaranteed investment gains
various types and categories of investments
38
How do you calculate the
average daily rate
for compounding interest on a credit account?
None of the other choises are correct
Divide your APR by the number of business days in your billing period
Divide your APR by 52
Divide your APR by 365
39
Financial assets derive their value from ______________________.
a contractual claim on the underlying asset
the bid/ask spread
market demand and liquidity
market supply and demand
40
The percentage of a person's available credit that has been used is referred to as _______.
Remaining Credit Balance
DTI (debt to income) ratio
Carrying a Balance
Credit Utilization
41
How do you generate
income
from stock holdings?
Via interest
Via splits
Via market expansion
Via sales
42
Which of the following is part of a mutual fund quote?
None of these
EPMD
Restricted Shares
Inception Date
43
Which is considered an
poor
credit score?
725
625
525
825
44
Which of the following has the biggest impact on your credit score?
New Credit Inquiries/Accounts
Credit Mix
Payment History
Length of Credit History
45
The highest price a buyer is currently willing to pay for a stock.
Bid
Beta
Ask
Volume
