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Semester Exam Review - Chapters 1-3 Flashcards | StudBud
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Semester Exam Review - Chapters 1-3
Semester Exam Review - Chapters 1-3
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1
Dave Ramsey has always had great spending habits
False
True
2
Why is credit so popular now?
All the above
Because people buy things they cannot afford
It is normal to have credit debt
It is easy to get credit
3
Budgeting is crucial to your financial success.
False
True
4
What does the FV stand for in this equation? FV=PV(1+r/m) ^mt
the number of years you leave it invested
the present value
the annual rate of interest as a decimal
the future value
5
Saving money over time for a large purchase is known as?
Compound Interest
Emergency Fund
Sinking Fund
Interest Rate
6
Rent is a:
D) Intermittent expense
B) Variable expense
A) Fixed expense
C) Discretionary expense
7
Which of the following is
not
one of the three basic reasons for saving money?
Having money to lend friends
Emergency Fund
Build Wealth
Large purchases
8
A summary of all the income and outgo over a certain time period
transaction
cash flow statement
discretionary
budget
9
A fee paid by a borrower to the lender for the use of borrowed money.
credit
loan
interest
debt
10
What do you need to manage your money
behavior
cost
value
debt
11
Automatic account transfers are the easiest way to save for emergency fund/large purchases.
True
False
12
What year did credit take root in America?
1920
1977
1995
13
Once you have a money plan you need to _____?
execute it
forget it
share it
14
Managing money success is about ____% head knowledge
80
20
10
40
15
Car repairs are a:
D) Intermittent expense
B) Variable expense
A) Fixed expense
C) Discretionary expense
16
A debit card cannot be used for online purchases.
True
False
17
The granting of a loan and the creation of debt; any form of deferred payment.
Debt
Credit
Loan
Debit
18
Average Credit Card debt is about
5k
15k
20k
50k
19
Your monthly budget should include:
A) Variable expenses
C) Fixed expenses
D) All of the above
B) Discretionary expenses
20
Learning the language of money is not that important
False
True
21
What % of American families have no savings at all?
25%
40%
15%
35%
22
Your own record of all your transactions
check in to cash
check yo self
before you wreck yo self
check register
23
Why didn't people loan money prior to credit taking root?
People did not need it
There were too many laws, and no money to be made
It was embarassing
24
Your income level greatly affects your saving habits?
true
false
25
An item that is bought without previous planning or consideration of the long-term effects
reconcile
envelope system
impulse purchase
sale item
26
Which of the following is something that a typical millionaire would do?
D) Carry debt
C) Replace things that are not broken
B) Spend less money than he or she makes
A) Lease a new car
27
A written cash flow plan
budget
envelope system
personal finance
sale item
28
The amount you save is determined by how much money you have left at the end of the month?
false
true
29
Which of the following is a consequence of overdrawing your checking account?
A) Bounced check fee from the store
D) All of the above
C) Overdraft fee from your bank
B) Stress from money mismanagement
30
Is a area of production, distribution, or trades of goods and services.
Recession
Inflation
Economy
Interest-Bearing Account
31
The average amount of credit card debt in an American family is...
$10,799
$15,799
$25,799
32
The persistent increase in the cost of goods & services or the persistent decline is purchases.
Inflation
Interest-Bearing Account
Recession
Economy
33
Groceries are a:
C) Discretionary expense
D) Intermittent expense
B) Variable expense
A) Fixed expense
34
A written budget, if followed, removes ________ from your finances.
D) All of the above
B) Guilt
A) Overspending
C) Management by crisis
35
Percentage paid to a lender for the use of borrowed money (in debt) is known as?
Emergency Fund
Sinking Fund
Compound Interest
Interest Rate
36
To match your bank statement with your checkbook
budget
carbon check
reconcile
cash flow plan
37
What step in the 5 foundations is-get out of debt
step 2
step 3
step 4
step 1
38
All of the decisions and activities of an individual or family regarding money
Consumer
Personal Finance
Money Knowledge
Financial Literacy
39
We are told that debt is _____
Normal
Alright
Good
40
What does the (r) stand for in this equation? FV=PV(1+r/m) ^mt
the number of years you leave it invested
the future value
the annual rate of interest as a decimal
the present value
41
People buy things they cannot afford to look rich or cool
True
False
42
Non-essential expenses
intermittent
discretionary
fixed
variable
43
A person or organization that buys/uses goods or services is...
Person
Consumer
Creditor
44
Which of the following is NOT a reason credit is marketed so heavily to consumers in the US.
Strong consumer demand for big ticket items
The credit industry has become extremely profitable
The use of credit is not socially acceptable in the US.
45
Which of the following is not a record-keeping feature you could expect from your bank?
D) A monthly account statement
C) Customer service reconciles your account for you
B) An account register
A) A reconciliation sheet
46
At your age, a fully funded emergency fund should be?
1000
100
5000
500
47
Expenses that remain the same from month to month
intermittent
variable
fixed
discretionary
48
Knowing the ____ of money allows you to tell your money what to do
Economy
Personality
Language
Status
49
Most American families live paycheck to paycheck...
True
False
50
Dining out is a:
C) Discretionary expense
B) Variable expense
A) Fixed expense
D) Intermittent expense
51
Percentage of Americans living paycheck to paycheck:
B) 25
A) 70
C) 50
D) 40
52
Instead of borrowing money for large purchases, your should set money aside in a __ over time.
Savings Account
Piggy Bank
Checking Account
Sinking Fund
53
An obligation of repayment owed by one party to a second party.
Debt
Credit
Debit
Personal Finance
54
The first thing you should save for is your retirement fund?
false
true
55
The following are guidelines for budgeting with an irregular income except:
A) Prioritize the list in order of importance.
C) Budgeting with irregular income isn't any different
B) Make a list of all of your expenses for the month ahead.
D) When your check comes in, spend your money down the list.
56
An account that generates interest income on the available balance in the account.
Interest-Bearing Account
Economy
Inflation
Recession
57
You need to set money ______?
Goals
down
Due date
aside
58
You should keep your emergency fund in the same account as your spending money?
true
false
59
What does the (m) stand for in this equation? FV=PV(1+r/m) ^mt
the annual rate of interest as a decimal
the future value
the number of years you leave it invested
the number of times per year the interest is compounded
60
The granting of a loan and the creation of a debt is...
Normal
Payment plan
Credit
61
Debt evidenced by a note which specifies the principal amount interest rate & date of repayment
Interest
Debt
Loan
Credit
62
The zero-based budget is the best method of budgeting because:
D) It ensures that every dollar you make has a purpose
C) Sticking to a zero-based budget requires less discipline
A) It is less complicated
B) A zero-based budget allows less money for wants
63
Online bill pay allows you to pay without having to write a check and send it in the mail.
False
True
64
A temporary decline during which trade & industrial activity are reduced/drop in spending.
Interest-Bearing Account
Inflation
Economy
Recession
65
Writing and following a zero-based budget will help you avoid overspending/ impulse purchases
False
True
66
Which of the following account records would have the most current balance?
B) Your own account register
D) All of these records will have accurate account balances
A) Account balance statement from the ATM
C) Your monthly bank statement
67
Was Dave Ramsey ever bankrupt?
yes
no
68
What does the PV stand for in this equation? FV=PV(1+r/m) ^mt
the annual rate of interest as a decimal
the present value
the number of years you leave it invested
the future value
69
What are the 3 basic reasons to save money?
emergencies, large purchases, and wealth building
large purchases, going into debt, and wealth building
emergencies, money to lend friends, and wealth building
wealth building, money to lend friends, large purcahses
70
The envelope system works great for managing spending on things that are variable expenses
True
False
71
Which of the following statements is false?
B) A budget is a written plan for saving and spending.
D) A cash flow statement is has what has already occured
A) A cash flow statement has all income spending over time
C) A budget has what has already occured
72
$500 in readily available cash to be used only in the event of an emergency is known as?
Sinking Fund
Emergency Fund
Interest Rate
Compound Interest
73
What step in the 5 foundations is-pay cash for college?
step 2
step 3
step 4
step 1
74
The "normal" American family is broke
False
True
75
What is personal finance?
decisions I make regarding earning, saving, spending $
My checkbook
The banks way of holding my money
76
A person or business that offers loans at extremely high interest rates
loan shark
creditor
financer
bank
77
About how much money do Americans charge on their credit cards each year
millions
billions
thousands
hundreds
78
The number-one cause of divorce in North America today is stress and disagreements over money.
True
False
79
Having more than one bank account is never a good idea since it can complicate money management
False
True
80
What step in the 5 foundations is-pay cash for your car?
step 1
step 3
step 2
step 4
81
T or F It is ok to use your emergency fund to pay cash for big purchases such as a tv?
False
True
82
The knowledge & skill-set necessary to be an informed consumer and manage finances effectively.
Interest
Financial Literacy
Money Truth
Personal Finance
83
What is the purpose of the Five Foundations?
to make sure you have money for friends
for banking information
to spend all your money
framework for financial success
84
What step in the 5 foundations is-save a $500 emergency fund?
step 1
step 2
step 3
step 4
85
A system by which goods and services are produced and distributed.
Economy
Inflation
Personal Finance
Exchange
86
ʺPay yourself firstʺ means to assign a portion of your income to saving/investing every month.
False
True
87
The five steps to financial success are known as?
Five Financial
Five Foundations
Five Successes
Five Funds
88
What step in the 5 foundations is-build wealth and give?
step 5
step 4
step 2
step 3
89
Doing a budget does not:
A) Show if you are overspending in an area
B) Make overspending more likely
D) Make your money go further
C) Remove guilt/shame sometimes associated with a purchase
90
Series of envelopes that are divided into categories and are used for cash for expenses
envelope system
check carbon
overdraft
reconcile
91
What does the (t) stand for in this equation? FV=PV(1+r/m) ^mt
the number of years you leave it invested
the future value
the annual rate of interest as a decimal
the number of times per year the interest is compounded
92
If you write a zero-based budget every month, it is not necessary to reconcile your account.
True
False
93
Interest paid on interest previously earned is known as?
Sinking Fund
Compound Interest
Interest Rate
Emergency Fund
94
You must write out a detailed ________?
Answer
Plan
Description
95
Occurs when money is withdrawn from a bank account and the available balance goes below zero
zero-based
Overdraft
Reconcile
carbon copy
96
Interest paid on interest previously earned is known as?
Interest Rate
Compound Interest
Emergency Fund
Sinking Fund
97
What % of American are not saving for retirement?
15%
25%
40%
35%
98
Managing money success is about _____% behavior
80
60
20
90
99
Assigns an expense to every dollar of your income, the income minus the expenses equals zero
zero-spending plan
overdraft
reconcile
zero-based budget
