Is a fee to payday loan company

One consequence of scarcity is that:

people have to make choices among alternatives.

What is the difference between gross and net pay?

Net pay is gross pay minus deductions.

Your landlord has the right to:

Charge you a late fee if your rent is late

The first three steps of economic decision-making are to:

define the problem, list alternatives, and state criteria.

Which filing status has the lowest tax rate

Married filing jointly or qualifying widow

What are the three most important criteria to consider when investing?

risk, rate of return, liquidity

Beginning to save while you are young is recommended by financial experts because it:

lets compound interest work in your favor

An installment loan is

A loan paid off in equal payments over time

Which of the following people do you think would need life insurance the most?

A single working mom with two kids

combination of letters and numbers

Human capital can be defined as:

Skills acquired through learning and volunteering

A 30-year-old woman has health insurance plan that has a 1,500 deductible. What does this mean?

She pays $1,500 of her medical expenses then insurance pays

The government uses most of the money collected from taxes to

Provide goods and services for the public.

What is the general relationship between risk and reward?

the higher the risk, the higher the potential reward

An example of a want and a need, in the correct order, is:

New automobile & basic clothing, Dishwasher& adequate shelter

Diversification is good because

It spreads the risk of investment

A warranty from the manufacturer covers

Only what is included in the statement

The Better Business Bureau is

A nonprofit consumer organization

Which strategy is most likely to improve most people's financial situation over a lifetime?

saving early in life when a person begins earning an income

Credit history includes

savings and credit card accounts

What is the opportunity cost to the individual who chooses to drop out of high school?

The higher income they could have earned in the job market

Why is it not a good idea to make early withdrawls from your 401k?

You usually have to pay a strict penalty

requires membership but is just like a bank

Depends on amounts owed and payment history

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Personal Finance Final Exam Review

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Financial Literacy test review

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Questions 50

Answers

1
If Joe buy auto insurance that covers damages to others he causes that insurance is called:
Liability
No-Fault
Collision
2
Improving your credit score will let you get
Higher interest rates on savings accounts
Neither of the above
Both of the above
Lower interest rates on loans
3
Saving accounts at banks are protected by
Risk and return curves
FDIC insurance
An annual percentage
Mutual fund returns
4
A series of numbers on a check that lets the payee know what institution to withdrawal payment
Account Number
Routing Number
Serial Number
5
An overdraft fee
Is a fee to payday loan company
Is the minimum balance required to be held in a bank account
Is a fee charged by a business when a check you write bounce
6
Using rule of 72, how long will it take your money to double if deposited in an account at 7.2%
14.4 years
7.2 years
20 years
10 years
7
this agency educates consumers and businesses about their rights and responsibilities:
Consumer Product Safety Commission
Food and Drug Administration
Federal Trade Commission
Federal Consumer Information Center
8
When paying bills online, a payee is
Someone who pays you
A middleman who relays a payment to another party
Someone you send a payment to
9
What is the net pay? 30 hrs/week @ $10/hr Deductions - $50 fed, $20 state, $30 FICA.
$200
$300
$230
$250
10
One consequence of scarcity is that:
the production of goods and services is constant.
there is full employment of resources.
people have to make choices among alternatives.
products which are plentiful have relatively high prices.
11
Joe works full-time at Bob's Diner. Who pays the FICA contributions on Joe's wages?
Joe only
the federal government
Joe's employer only
Joe and his employer
12
What is the difference between gross and net pay?
Net pay is gross pay minus deductions.
Gross pay is net pay minus saving.
Net pay is gross pay minus saving.
Gross pay is net pay pay minus deductions.
13
Your landlord has the right to:
Charge you a late fee if your rent is late
Nothing at all
Enter your apartment without permission
14
learning period including on-the-job training (with pay) and additional coursework at night.
cooperative education
occupational training program
apprenticeship
internship
15
The first three steps of economic decision-making are to:
draw conclusion, construct models, and make generalizations.
identify assumptions, make a policy, evaluate the policy.
gather facts, form a theory, and conduct a simulation.
define the problem, list alternatives, and state criteria.
16
Which filing status has the lowest tax rate
Single
Married filing jointly or qualifying widow
Head of Household
Married filing separately
17
What are the three most important criteria to consider when investing?
size, insurance, taxes
leverage, margins, credit
risk, rate of return, liquidity
collateral, access to accounts, dividends
18
Which is an element of a financial goal?
Time bound.
Specific.
All of these
Realistic.
19
What will keep you from owing more then what your vehicle is actually worth?
Down Payment
Finance charges
Insurance
Interest
20
Beginning to save while you are young is recommended by financial experts because it:
is hard to save later in life when you have more income
locks in higher interest rates when you buy on credit.
lets compound interest work in your favor
is easier to save when you first begin earning income
21
An installment loan is
When an item is paid for before is is picked up
A credit card paid off right away
A loan paid off in equal payments over time
22
Which of the following people do you think would need life insurance the most?
A single working mom with two kids
An elderly retired man with a wife who is also retired
A single college grad without kids starting his first job
A single wealthy businesswoman without dependents
23
A good password:
Should be written down in your wallet
Should be used for all your online accounts
Is an easiy remember number such as your phone number or SSN
combination of letters and numbers
24
Human capital can be defined as:
Fees paid to a college or university to take classes there
Skills acquired through learning and volunteering
type of work a person performs
Money earned through human labor
25
Liquidity risk is highest for which type of investment?
savings account
real estate
mutual fund
individual stocks
26
Human capital consists of:
stocks and bonds.
knowledge and skills.
water and wood
plant and equipment.
27
A 30-year-old woman has health insurance plan that has a 1,500 deductible. What does this mean?
Her insurance company is responsible for paying $1,500
She pays $1,500 of her medical expenses then insurance pays
The hospital will only charge her $1,500
She can deduct $1,500 from the hospital bill.
28
Joy's daughter lived at college for nine months during the year meets what test.
Relationship
Both
Member of Household
Neither
29
Co-insurance and co-payment refer to the same thing.
False
True
30
The government uses most of the money collected from taxes to
Finance the Internal Revenue Service.
Encourage private enterprise.
Provide goods and services for the public.
Establish food networks.
31
You can best compare credit card offers by looking at these two features
Introductory rate and credit limit
Minimum payment
APR and fees
Principal and interest
32
What does ATM stand for?
Automatic Telling Machine
Actual Teller Machine
Automatic Talking Machine
Automatic Teller Machine
33
What is the general relationship between risk and reward?
the amount of risk does not influence potential reward
the higher the risk, the higher the potential reward
there is a relationship, but it is uncertain
the higher the risk, the lower the potential reward
34
An example of a want and a need, in the correct order, is:
A vacation & designer clothing
Basic clothing & adequate shelter.
New automobile & basic clothing
Dishwasher& adequate shelter
35
Diversification is good because
Interest rates rise and fall
It spreads the risk of investment
Mutual funds have higher fees than individual stocks
36
programs spent learning a trade such as firefighting, medical technology, or IT management.
internship
occupational training programs
cooperative education
apprenticeship
37
A warranty from the manufacturer covers
Everything that goes wrong for a year
Nothing after sixty days
All moving parts
Only what is included in the statement
38
Joe values (in order) a car, a boat, a cabin. He buys the car. Which is the opportunity cost?
car
boat
cabin
boat and cabin
39
Making contacts with people who may connect you to a potential employer is called
networking
recruiting
logrolling
connecting
40
A typical characteristic of entrepreneurs is that they:
are willing to take risks.
like to work part-time
would rather save than invest
enjoy working under supervision
41
The Better Business Bureau is
A place to report fraud or identity theft
A government agency in charge of recalls
A company that develops rules to protect consumers
A nonprofit consumer organization
42
Which strategy is most likely to improve most people's financial situation over a lifetime?
making financial decisions quickly based on intuition
Praying Aunt Sue dies soon and leaves you a lot of money
using credit to spend more than a person earns
saving early in life when a person begins earning an income
43
This number helps you compare loans
GPA
APR
Credit Score
Principal
44
Credit history includes
savings and credit card accounts
Only positve items, regardless of your borrowing past
Library fines
being a good friend
45
What is the opportunity cost to the individual who chooses to drop out of high school?
The payments made to companies hiring drop-outs.
The higher taxes one pays for leaving school early.
The higher income they could have earned in the job market
The lower interest rates one is charged for credit.
46
Why is it not a good idea to make early withdrawls from your 401k?
You usually have to pay a strict penalty
You cannot put the money back in once you take it out
You will lose your tax-deferred status on the entire account
47
How much money will you have if you put in savings $500 at 5% compound interest for 2 years?
more than $550
exactly $550
exactly $505
less than $550
48
A Credit union
requires membership but is just like a bank
Never has interest rates as good as a bank
Can't keep savings accounts
Is only open to college students
49
Your FICO score
Depends on amounts owed and payment history
Does not depend on your payment history
Depends most on new account information
Is better if you have not held credit accounts for very long
50
When is a contract made between a buyer and a seller?
Every time you make a purchase
Only when the purchase is over $50
When you buy something with a credit card
When you buy something online

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