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Ch.1 Introduction to Personal Finance Flashcards | StudBud
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Ch.1 Introduction to Personal Finance
Ch.1 Introduction to Personal Finance
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Introduction to Personal Finance Test Review Game
Flashcards
32 cards
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Practice quiz
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Questions
32
Answers
1
Which of the following is not a true statement?
As banks made more $, they were willing to lend more $.
After 1970, consumer debt skyrocketed.
America's credit industry has not changed much since 1917
Americans learned to borrow amidst post-WWII prosperity.
2
Which of the following statements best explains why income alone does not determine wealth?
Income alone does determine a person's wealth.
Only people who are natural savers can become wealthy.
How much $ a person makes doesn't control their $ behavior.
Investing is the only factor that helps build wealth.
3
Learning the language of money is not that important because you can rely on financial planners
True
False
4
The credit system today uses high interest rates and fees to turn huge profits.
True
False
5
The knowledge and skills necessary to be an informed consumer and manage finances effectively__
financial literacy
budgeting
6
When developing a personal financial plan you should look at your assets, and liabilities.
True
False
7
When it comes to managing money, success is about ___% knowledge and ___% behavior.
60,40
80,20
20,80
50, 50
8
Personal Financial success is primarily the result of:
Generous welfare and unemployment programs
Managing your money behavior
Inheriting money from your parents
Winning the lottery
9
Which of the following best explains why students should learn about personal finance?
Finance skills are better learned through trial and error.
Personal finance skills require a lot of time to learn.
Learning to manage money will lead to a profitable career.
Learning to handle money can help get rid of financial issue
10
Everyone should have the same financial plan. The same budget should work for everyone.
False
True
11
Which of the following is not a factor in becoming money smart?
Manage your behavior with money
Learn how to read your credit card statements.
Learn the language of money
Have knowledge of basic math
12
Expensive houses and new cars are a true indication of wealth.
False
True
13
A person or business that offers loans at extremely high interest rates is a
loan shark
creditor
14
The widespread financial insecurity of Americans is primarily because:
The incomes of Americans are low
Most Americans save a high proportion of their income
Government programs are unavailable to help disabled people
The saving rate of Americans is low and their debt is high
15
Most Americans avoid the use of credit when it comes to buying big-ticket items like a car.
False
True
16
Why was the use of credit uncommon prior to 1917?
All of the above.
Laws prevented lenders from charging high interest rates.
Borrowing money was generally not socially acceptable.
Lending money to to others was not profitable.
17
When it comes to personal finance, the math is easy. Whats challenging is managing your ___.
Behavior
Income
Bank account
Friends
18
Having debt keeps you from building wealth.
True
False
19
An obligation of repayment owed by one party to a second party is called a
ownership
debt
20
A system by which goods and services are produced and distributed
assets
economy
21
Which of the following choices best describes how Americans are being outsmarted by banks?
We are driven by consumerism.
Buying things on credit has become acceptable in our culture
Credit is marketed so well that we desire to have it.
We are taught that we can buy happiness.
22
Since you are a teenager, what you do now with $ will have little effect on your future.
True
False
23
A person or organization that buys a product or service is a
borrower
consumer
24
Decisions of an individual or family regarding their $ including spending, saving, budgeting is
personal finance
currency
25
Key components of financial planning include all of the following except:
Regularly monitor and reassess your financial plan
Replace money myths with money truths
Allow your financial planner to make all your money decision
Write out a detailed plan for accomplishing your goals
26
The granting of a loan and the creation of debt; any form of deferred payment is
credit
annual fee
27
Which of the following is not a benefit of understanding your own money personality?
Knowing your $ personality allows you to think about $ habit
Recognizing who you are allows you the opportunity to grow.
None of the above.
You can make a budget once you know your $ personality
28
Most Americans today are wealthy and will have financial security when they retire.
True
False
29
A fee paid by a borrower to the lender for the use of borrowed money
interest
bills
30
Which of the following is not a reason credit is marketed heavily to U.S. Consumers?
The use of credit is not socially accepted in the US.
Since 1920, credit laws in the US have been relaxed
The credit industry has become extremely profitable.
There is strong consumer demand for big-ticket items.
31
Which of the following is a consequence of spending more than you make?
A cycle of debt
Stress
All of the above
Missed opportunity to save and invest.
32
True financial security is achieved when your money begins to generate an income.
False
True
