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W!SE REVIEW 2021 Flashcards | StudBud
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W!SE REVIEW 2021
W!SE REVIEW 2021
62 terms
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62 Questions on Savings, Banking, Payment Types, Credit, Renting v Owning, and Investing
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1
When buying a stock in a company, you are:
a. diversifying your portfolio
d. buying a portion of a company
b. investing in an index fund
c. loaning money to a company
2
Use the check to answer the following: The first set of numbers (123400056) on the check is:
the bank routing number
the member number
the bank account number
the check number
3
Which of the following typically have the highest fees?
b. Credit Union
a. Retail Bank
d. Payday Lender
c. Online Bank
4
Why has Jude been labled an assign risk by his auto insurance company?
Jude has five speeding tickets this year.
Jude is a new driver.
Jude has made too many auto insurance claims this year.
Jude has a fast sports car.
5
What is the great Economic Dielmma?
Not enough money
The Invisible Hand
Energy shortages
Scarcity
6
How often are you entitled to a free credit report from each major credit reporting agency?
a. Yearly
c. Whenever you use credit
b. Monthly
d. Prior to making large purchases
7
A credit card company can raise your interest rate w/o notifing you.
True
False
8
The US bills or "paper money" is also known as
greenbacks
goldbacks
greenies
green certificates
9
Purchasing without a budget leads to
implusive spending
deficit spending
credit card debit
surplus spending
10
Which form is your employer required to send to you before you file your tax return?
a. Yearly paycheck stub
b. 1040EZ
c. W-4
d. W-2
11
The form filed by students to receive federal financial aid for school is known as:
d. FAA
b. FIFA
c. FICO
a. FAFSA
12
Which is the LEAST consideration when deciding to buy or lease a car?
Total cost of the car, Monthly loan payment amount
Down payment, Your monthly budget
Car interior and features
Your current savings
13
Good credit is usually NOT required for which of the following:
Purchasing a home, renting an apartment
Getting a credit card
Buying a new car,
Adopting a pet, buying new furniture
14
Your credit history is tracked by all of the following EXCEPT:
d. Trans Union
c. Experian
a. Equifax
b. Federal Reserve
15
How long can negative information stay on your credit report?
indefinitely
20 years
5 years
7 years
16
What is the relationship between Risk and Reward?
high risk, high reward
high risk, low reward
low risk, high reward
low risk, low reward
17
Which of the following will lower your credit score?
Ignoring a late payment notice
Paying a credit card bill late
Opening 3 credit cards at once
Using more than 30% of your available credit
18
Isaiah needs to visit the doctor. The cost $200. He has $20 co-pay. How much will he pay today ?
a. $0
d. $200
b. $20
c. $50
19
What is meant by "Don't put all of your eggs in one basket"?
Diversify your financial portfolio
Don't just buy stock or purchase a home
Buy more than one companies stock
Invest in stocks, bonds, real estate, & other investments
20
When you purchase a municipal bond, you are:
a. buying a portion of a municipality
d. loaning money to a municipality
b. diversifying your portfolio
c. investing in an index fund
21
Which of the following steps best protects your credit history if you suspect fraud?
Contact the credit bureaus and report suspected fraud
Contact the local police department and file a complaint
Contact the store where your credit card was used.
Contact the chamber of commerce & close your bank account
22
When applying for credit the most important factor is…
your credit rating (score)
if you have other debt
how long you have worked
how much you earn
23
Use the Credit Card Disclosure to answer the following: What is the annual fee for this card?
b. $5
a. $0
c. $29
d. $39
24
Seth makes $40,000 a year. His Assets are $100,000. His Liabilities are $50,000. What is his networth?
$150K
$190 K
$50K
$140K
25
Asim earns $250 per month. She spends $275. Which statement below is most correct?
Asim makes more than she spends.
Asim should save more in the future.
Asim spends more than she makes.
Asim should stop saving in the future.
26
Which of the following is an advantage of federal student loans?
They must be paid back while you’re in school.
d. Federal student loans do not accumulate interest.
They are only available to students who have financial need.
They have a fixed interest rate.
27
Which of the following typically has the lowest fees or costs to use?
c. Cash advance
d. Payday loan
b. Credit card
a. Debit card
28
Select the 3 tools the FED uses to stablize the economy
reserve requirements
Open market operations
adjusting interest rates
through subsidies
29
Which statement is most correct when choosing to rent or buy a home?
c. Rent a home because it is better than buying one.
a. Rent a home only until you can afford to buy one.
d. Buy or rent a home based on your individual circumstance.
b. Buy a home because it is better than renting one.
30
When paying off debt, which credit cards should be paid first?
the ones issued by your bank
the ones with the largest balance owed
the one with the highest interest rate
the one that is a joint account.
31
Why does the FED lower interest rates?
To stabilize the economy
To help financial institutions
The interest rate is not adjusted by the FED.
Because the economy is doing great
32
The set of numbers (1637) on the top-right of the check is:
the check number
the bank account number
the bank routing number
the member number
33
Which of the following is TRUE about gift cards?
Gift Cards cannot expire for 5 years.
Gift Cards can be replaced if stolen.
Gift Cardscan be "cashed in".
Gift Cards have NO RESTRICTIONS.
34
The main trade-off that all investors must consider is:
b. diversity vs. uniformity
d. risk vs. return
a. income vs. cost
c. stocks vs. bonds
35
Which scenario should Lisa pick if she wants to pay less interest on her car loan?
5 years at 5% interest
3 years at 3 % interest
5 years at 3 percent %
7 years at 5% interest
36
When you write a check, if you make an error what should you write on it?
Do not cash this check.
White-Out the mistake and make the correction.
My Bad.
VOID
37
Roth IRAs allow you to
withdraw up to $50,000 for college w/o penalty
withdraw up to $10,000 for college w/o penalty
withdraw up to $5000 for college w/o penalty
withdraw up to $15,000 for college w/o penalty
38
The period before you have to begin repaying your student loans is known as the:
a. default period
c. grace period
b. zero interest period
d. promotional period
39
A negative consequence of a credit card company raising your line of credit may
be encoraged to open more accounts
close the account
spend more money
spend more than you can pay back
40
Which of following drivers will likely pay the highest auto insurance premiums?
c. Drivers who have a safe driving records
b. Older, experienced drivers
a. Younger, inexperienced drivers
d. Drivers who travel short distances
41
Which type of bank account typically offers no interest?
b. Money market
d. Checking
a. Savings
c. Certificate of Deposit
42
What do you do with your 401K if you leave your job?
leave it in the account
take a check from your employer
have it directly put in your savings account
roll it over into a qualified account
43
Which piece of information is most useful to an identity thief?
Your full name and address
Your full name and social security number
Your full name and student ID number
Your full name and date of birth
44
Which will most benefit you financially?
A savings account that compound interest monthly
A savings account that compound interest yearly
A savings account that does not compound interest
A savings account that compound interest daily
45
Which of the following provides the best protection against identity theft?
Never use a credit card
Pay all bills with cash only
Shred documents that contain personal information
Open up a new bank account every year
46
Diversification is important in investing because…
It ensures that you only make low-risk investments.
It helps you gain the highest rate of return despite risks.
It increases your overall risk.
It helps you to balance risk across different investments .
47
Use the Credit Card Disclosure to answer : What is the APR after the initial 12 months?
d. 5.65%
b. 27.357%
a. 36.5%
c. 18.25%
48
Why does a corporation issue bonds?
to help Americans increase their wealth
to raise capital (money)
to lower liabilities
to lower assets
49
Why is Term Life insurance cheaper than Whole Life Insurance?
it will not pay as much to the beneficiaries
it is for low income people
it only has a death benefit
it is for young people just starting out
50
The term referring to the rate of yearly interest for your credit card is commonly known as:
b. APR
a. Default rate
d. Grace period
c. COD
51
Use the Rule of 72 to calculate how long it will take for money to double at 6% in interest:
16yrs
12yrs
36yrs
72yrs
52
What is meant by Predatory Lending?
Banks that charge higher interest rates.
Lenders that give loans with unfair terms, and inflated interest
Sending credit cards to people that don't apply
Lenders that force people to take loans they don't want
53
Typically, how long does bankruptcy stay on your credit report?
20 years
10 years
7 years
5 years
54
Which of the following statements is most correct?
A benefit of owning a home is the value may appreciate.
A benefit of renting is that you can move out when you want
A benefit of renting a home is you can make renovations .
A benefit of owning a home is that it is easier to move.
55
Which of the following example is NOT a type of savings vehicles?
Money Market Account
Checking Account
Savings Account
Certificate of deposit (CD)
56
Borrowing a subsidized federal student loan means the government will repay the loan...
d. ...as long as you have full time job after you graduate.
b. ..interest on the loan until 6 months after you graduate.
c. ...if you take a certain type of job after you graduate.
a. ... in full provided you graduate.
57
What date must federal taxes typically be filed and sent to the IRS?
b. April 1
a. March 17
c. April 15
d. March 15
58
What is meant by open market operations
opening new businesses
the FED buying & selling short term treasuries
capitalizism
freedom to be an entrepreneur
59
Select the three main credit bureaus
TransUnion
Transperian
Experian
Equifax
60
The Truth in Lending Act states
Banks & credit unions must be honest under oath in court.
If a consumer asks, banks must tell the truth about loans
Consumers must be honest when completing credit applicatons.
Consumers must be informed of interest rates & fees on loans.
61
In order to become a stock broker you must…
Have a Doctoral degree
Have a bachelor's degree
Have a license earned by passing a test
Have a high school dipolma
62
What are the responsibilities of a renter versus an owner?
c. Neither renter nor owner has control over the property
An owner has complete control over the property.
The renter & owner have equal control over the property.
A renter has complete and control over the property.
