FDR passed the New Deal because of the Great Depression of the 1930s. What was the purpose of this New Deal?

To promote economic recovery and social reform

In 1972, which association made borrowing money to attend college much easier?

The Student Loan Marketing Association (SLMA)

The difference between short-, medium-, and long-term financial goals is

short=up to 2 years; medium=up to 5 years; long term=more than 5 years

You should be aware whether you are a saver or a spender because...

Personal finance is 80% behavior so behavior primarily affects my finances.

As a single adult, you should

keep managing your money as a priority

Which of the following are The Five Foundations?

Save $500 for an emergency fund.

The First Foundation is

Save $500 for an emergency fund

To calculate net worth

subtract liabilities from assets

After WWI, demand for products increased and people began buying on credit. Because of this credit...

Started to become more socially acceptable

Fiancial goals should be

specific, measureable, time-sensitive, yours, and written

The best way to avoid running out of money too quickly is to ...

make it a habit to plan and set goals for your money

Savers have a tendency to be

strict with their money and not spend any of it

Making accurate choices with money involves knowing how...

Earning, budgeting, saving, spending, and giving affect your money.

To gain an understanding of your personal finances, you must know

where you stand financially, your income, your goals and how to reach them

Financial literacy is ...

having the knowledge and skill set required to handle money effectively

The Five Foundations are

a personal financial action plan

Living paycheck to paycheck means

income is devoted entirely to expenses so no money can be saved

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Economics Chapter 1 Test

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Questions 40

Answers

1
If your assets total more than your liabilities, you have a _______ net worth.
equal
unknown
negative
positive
2
FDR passed the New Deal because of the Great Depression of the 1930s. What was the purpose of this New Deal?
To create a borrowing system within the country
To divide the national budget in half and distribute it
To promote economic recovery and social reform
To promote climate change
3
In 1972, which association made borrowing money to attend college much easier?
The Student Loan Approval Association (SLAA)
Farmers Only Dot Com (FODC)
The Student Loan Marketing Association (SLMA)
The Federal Student Approval Association (FSAA)
4
Personal finance is 20% ______ and 80% ______.
cause; effect
behavior; head knowledge
reactions; behavior
head knowledge; behavior
5
Your money personality impacts your
your financial literacy level
how you handle money
understanding of bank transactions
what you plan for as an adult
6
The difference between short-, medium-, and long-term financial goals is
short=up to 2 days; medium=up to 5 days; long=more than 5 days
all goals should be short-term
short=up to 2 years; medium=up to 5 years; long term=more than 5 years
short=up to 2 months; medium=up to 5 months; long term=more than 5 months
7
Avoiding debt can lead to financial freedom and hope.
False
True
8
Which of the following is one of The Five Foundations?
Debt is necessary in today's world economy.
It is okay to incur debt as you can always live in your parents' basement.
Get out and stay out of debt.
It is okay to go into debt because you deserve to have everything you want.
9
A ______ financial goal takes up to two years to reach.
Short-term
Medium-term
Long-term
Five-level
10
You should be aware whether you are a saver or a spender because...
Businesses do not hire spenders.
Personal finance is 40% behavior so behavior primarily affects my finances.
Personal finance is 80% behavior so behavior primarily affects my finances.
Knowing ourselves is the highest calling.
11
Which of the following is one of The Five Foundations?
Pay cash for your car.
AOC drives a Tesla.
BMWs are the Ultimate Driving Machines.
Car loans are a good financial option since the interest rates are so low.
12
What is The Fifth Foundation?
Build wealth and give.
Find a financial professional.
Pay cash for your car.
Only marry a person who has a lot of money.
13
Being a spender has many more positives than being a saver.
False
True
14
How does your money personality affect your spending behavior?
As a spender, I do not consider the future enough.
All of the above are correct.
As a saver, I take few risks with my money.
As a saver, I never spend money on anything.
15
You are either only a natural saver or a natural spender. You cannot have the balance of both.
False
True
16
It is possible to pay for college with cash.
False
True
17
As a single adult, you should
keep managing your money as a priority
date as many people as you can before it's too late
beward of planned and budgeted buying
seek a financial counselor or advisor by age 25
18
Which of the following are The Five Foundations?
Save $5,000 for an emergency fund.
Save $500 for an emergency fund.
It is pointless to save for an emergency fund at my age.
Save $50,000 for an emergency fund.
19
The First Foundation is
Pay cash for college
Open a checking account
Build wealth and give
Save $500 for an emergency fund
20
Using credit has not always been socially acceptable, but it has become
necessary for American life
less acceptable
normal in American culture
a whole lot of fun
21
Personal finance is all financial decisions a ______ must make to earn, budget, save, spend, and give money over time.
Individual or company
Bank
Nobody's business but mine
Individual or family
22
Which of the following explains how The Five Foundations help with money management now?
I will learn how to write checks.
I will win with money.
A and B only.
Following them will keep me on the right financial course
23
Which of the following is one of The Five Foundations?
Build bridges and charge the highest toll possible
Throw away tv, have lots of kids, move to the country, and build a home.
Build wealth and give
Build houses and charge the highest price the market will bear
24
Which of the following is one of The Five Foundations?
Student loans are the best economic choice to pay for college.
Pay cash for college.
Rack up as much college debt as you can, our President will cancel it.
Going to college is a poor financial decision.
25
To calculate net worth
subtract assets from checking accounts
add liabilities to assets
subtract liabilities from checking accounts
subtract liabilities from assets
26
After WWI, demand for products increased and people began buying on credit. Because of this credit...
Increased so rapidly loan sharks became obsolete
Was devalued in the marketplace
No one knows or cares
Started to become more socially acceptable
27
Fiancial goals should be
specific and measureable
only time-sensitive
timely, bank-based, specific and yours
specific, measureable, time-sensitive, yours, and written
28
The best way to avoid running out of money too quickly is to ...
invest in crypto currency
avoid making any purchases for the next 30 days
make it a habit to plan and set goals for your money
put all your money in a safe place and do not spend it
29
You should always make sure you have a
budget
credit card
debit card
direct deposit
30
A money principle to keep in mind is to live on ____ you make.
more than
less than
exactly 20% below what
the same amount
31
Banks got into the credit businsess before 1920 because charging exceptionally high interest rates was legal.
False
True
32
Savers have a tendency to be
strict with what they spend their money on, except for groceries
strict with purchases only for themselves
strict with purchases while spending money without a plan
strict with their money and not spend any of it
33
Making accurate choices with money involves knowing how...
Earning, budgeting, saving, spending, and giving affect your money.
Planning, spending, and investing defines a person's financial portfolio.
To make deposits into a bank account.
Consumer decisions affect my accounts
34
Which financial goal takes up to two years to reach?
Long-term
Medium-Term
Five-level
Short-term
35
Without any debt, you can be outrageously ______.
selfish
generous
thrifty
good-looking
36
An important money principle to consider is that you should ______ and ______ your money.
save; invest
spend; invest
steal; horde
invest; layout
37
To gain an understanding of your personal finances, you must know
where you stand financially, your income, your goals and how to reach them
your investment portfolio and your financial advisor's contact information
how much money you make
your financial goals
38
Financial literacy is ...
the ability to read account statements
reading books about finance
overrated
having the knowledge and skill set required to handle money effectively
39
The Five Foundations are
a starting point for adults regarding finances
a financial literacy technique
a personal financial action plan
a common conclusion for debt
40
Living paycheck to paycheck means
not depositing paychecks
income is devoted entirely to expenses so no money can be saved
not being able to plan past the next paycheck due to outside circumstances
eagerly awaiting the next paycheck to plan for the month's expenses

Economics Chapter 1 Test Flashcards | StudBud