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Financial Literacy Prep for Wise Test Flashcards | StudBud
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Financial Literacy Prep for Wise Test
Financial Literacy Prep for Wise Test
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Financial Literacy Review from Everfi
Flashcards
74 cards
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Practice quiz
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Questions
74
Answers
1
Using the FAFSA form,you can apply for:
the federal work study program
federal student loans
private loans
both a and b
2
A business owned by a group of stockholders
Corporation
Sole proprietor
Group of friends
Partnership
3
What is deflation?
The rate at which the general level of prices goes down
When there is a reduction in the supply of money or credit
when the general level of prices goes up
4
Which institutions give loans?
pawn shop
payday lender
credit union
all
5
What is a cashier's check?
A check guaranteed by the bank that writes the check
A check you receive from your friend out of their checkbook
A check you write to the bank
6
After you send in your FAFSA form,what will you receive back?
a copy's of your family's tax returns
your student aid report
your IRS date retrieval form
a copy of your complete FAFSA form
7
Insurance can help you:
reduce the chances of getting int an accident
minimize monthly expenses
cover all out of pocket costs
protect against unexpected accidents
8
Which of the following are costs associated with owning car?
Repairs
Wear & tear fees
Fuel
Insurance
9
The main trade-off that all investors must consider is:
risk vs return
diversity vs uniformity
stocks vs bonds
income vs cost
10
Which is cheaper, term or whole life insurance?
Whole
Term
11
Which loan type requires you to make loan payments while you’re attending school?
Both a & b
Subsidized federal loan
Unsubsidized federal loan
Neither a & b
12
The best way to investigate fraudulent transactions on your credit card is to:
Review your recent credit card statement
Keep track of your monthly budget
Review all old bank statements
Keep a copy of your bank statements in a safer place
13
Where can you find information about Financial Aid? Check all that apply
College Financial Aid Officer
Online
Town hall
Counselor
14
Which of the following are NOT deducted on a typical paystub:
Sales tax
State Income Tax
Medicare tax
Social security tax
15
Which type of life insurance never expires?
Term
Whole
16
The return investment (ROI) from education is typically the highest for:
someone with a 4-year degree
A high school graduate
a college applicant
Someone with a 2 year degreee
17
What are pensions and 401ks?
Ways to save for retirement
Taxes you pay
Insurance you buy
18
Which are the correct orders of investments from Lowest risk to Highest risk?
Stock−Treasury bond−Diversified mutual fund
Treasury bond−Stock−Diversified mutual fund
Treasury bond−Diversified mutual fund–Stock
Diversified mutual fund−Treasury bond−Stock
19
Pay that is figured under hourly rate
Wage
commission
Bonus
20
Insurance can help you:
minimize monthly expenses
reduce the chances of getting into accident
cover all out of pocket costs
protect against unexpected accidents
21
When you buy insurance, you and the insurance company are_______________.
breaking the law
entering into a contract
sharing the risk
22
Renting provides_________flexibility but can lead to_________costs in the long-‐term
less;lower
less;higher
greater; lower
greater; higher
23
Pay that is fixed amount regardless of hours worked
Salary
Tip
Bonus
24
The ______ tells you how many years it will take an investment to double.
Rule of 72
bank
Doublemint twin rule
25
Municipal bonds are exempt from federal taxes and state taxes
True
False
26
Which type of insurance requires you to have a Primary Care Physician?
HMO
PPO
27
Diversification is __________.
safer than having a portfolio that isn't diversified
buying many different types of stocks to have less risk
buying one type of stock
28
What is the best form of payment for a waitress at Applebee's?
salary
tip
wages
29
Which investment offers the lowest risk?
Savings Account
Stocks
Bonds
30
When you purchase a municipal bond, you are:
diversifying your portfolio
investing in a index fund
loaning money to a municipality
31
Your
net worth
is the difference between the amount you own and the debts you owe.
False
True
32
It's best to start saving for retirement when you're about 15 years away from retirement
False
True
33
Identity thieves can use your personal information to
Sign up for electricity service
All of the above
Get a cell phone contract
Open a credit card
34
What is the safest way to dispose of old bank account statements?
Put them in the trash unopened
Throw them out in trash
Shred them in a paper shredder
Keep them bundled together in a folder
35
Which of the following is generally true about 401(k) and 403(b) retirement plans?
all the above
they restrict when you can withdraw your money
they are plans offered through employers
they offer some tax benefits
36
PAYMENTS OR PROPERTY GIVEN TO PEOPLE OR INSTITUTIONS, WHICH DO NOT HAVE TO BE PAID BACK
STOCK
BONDS
GRANTS
37
Which of the following will charge the highest interest rate?
credit unions
pawn shops and payday lenders
Banks
38
A bear market last longer than a bull market.
False
Ture
39
A voluntary payment offered to an employee based on quality of service
tip
bond
salary
40
When you buy a ______________, you are loaning money to an organization.
Bond
Index Fund
Stock
Mutal Fund
41
How much should you pay for coverage monthly? Premium $300 month; deductible $500
$300
$800
$200
$500
42
What is the unauthorized use of a credit card?
using a stolen credit card at a store
using a credit card at a gas pump
using a credit card at the store
43
Committing money to an enterprise in order to earn a financial return is known as___.
Investing
Plan of action
salary
44
What is a recession?
A period of prosperity
A period of time in which the economy goes up
A period of time in which the economy goes down
45
What is the best form of payment for a part-time employee at Best Buy?
Tip
Salary
Commission
Wages
46
What is a tax exemption?
Something ppl have to pay higher taxes than other citizens
Something that ppl get when they have dependants
Something that may be claimed by an indiv. to reduce taxes
47
A_________is generally considered an appreciating asset bcuz it will_________in value over time
house; increase
house; decrease
car; increase
car; decrease
48
It's important to reconcile your checking account to make sure of mistakes
True
False
49
The form you complete to determine how much tax to withhold from your paycheck is the_______.
W-2
1099
1040 EZ
W-4
50
The Federal Reserve System:
was created by Congress to provide a safer monetary sytem
is the central bank of the US
Is who you pay your taxes to
51
When buying stock in a company, you are:
loaning money to a company
buying a portion of the company
diversifying your portfolio
investing in an index fund
52
Which asset is more liquid?
money in a certificate of deposit
money in a savings account
a house
53
What is the best form of payment for a part-time employee at Best Buy?
commission
salary
wages
Tip
54
Municipal bonds are exempt from federal taxes and state taxes
True
False
55
You should reconcile your checking account
every week
once a year
when you get your monthly bank statement
every six months
56
Which document puts you at the least risk of identity theft?
Old tax records
Pre-approved credit card offers
Cash receipts
paycheck stubs
57
An installment loan is:
a loan in which you make monthly payments
a loan paid off in one lump sum
a loan from your mom that you will pay next month
58
Which of the following is an advantage of federal student loans?
federal student loans must be paid back while in school
federal student loans have a fixed rate
federal student loans do not accumulate interest
59
What is a mortgage?
A type of rent used to pay for housing
a measure of the value of a home
a type of loan used to buy property
a measure of your credit rating
60
When you purchase an item in a store, you may be charged__________.
sales tax
capital gains tax
property tax
income tax
61
The largest secondary market for stocks/securities in the U.S, is the_________.
Dow Jones
NASDAQ
New York Stock Exchange
62
A list of steps needed to reach a career goal
Things needed to do
Plan of action
Steps to success
63
Jan pays $70 each month for her auto insurance policy.This regular payment is called a:
co-pay
premium
deductible
claim
64
Compounding of interest allows a principal amount to grow at a ____ rate than simple interest.
faster
slower
exchange
65
Which is better, a bull market or a bear market?
Bull
Bear
66
Someone gets your tax documents. If this person is not caught, you will likely be a victim of _
identity theft
murder
tax fraud
67
What is the primary reason to issue stock?
to help investors earn high rate of returen
distribute the risk of bankruptcy across investors
to raise money to grow the company
increase investor awareness of the company
68
What is a credit union?
It's the same as a bank
Non-profit institution that is owned by its members
Where ppl with bad credit acquire loans
69
What type of investment has the highest risk?
Savings Account
Stocks
Bond
70
A business with co-owners, in which both parties are legally joined together
Cooperation
Partnership
Entrepreneur
Sole proprietor
71
What is liquidity in business?
how quickly you can convert an asset to cash
water
money invested in a house
72
Someone who organizes, manages, and assumes the risk of owning a business
Sole proprietorship
Entrepreneur
Partner
73
Which earns you more money over time?
Simple interest
No interest
Compound interest
74
An investment portfolio should always be diverse.
True
False
