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Duplicate of Financial Literacy Prep for Wise Test
Duplicate of Financial Literacy Prep for Wise Test
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Financial Literacy Review from Everfi
Flashcards
75 cards
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Practice quiz
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Questions
75
Answers
1
A business owned by a group of stockholders
Sole proprietor
Corporation
Group of friends
Partnership
2
Insurance can help you:
reduce the chances of getting into accident
protect against unexpected accidents
cover all out of pocket costs
minimize monthly expenses
3
Compounding of interest allows a principal amount to grow at a ____ rate than simple interest.
faster
exchange
slower
4
Someone who organizes, manages, and assumes the risk of owning a business
Partner
Entrepreneur
Sole proprietorship
5
What is a credit union?
Non-profit institution that is owned by its members
Where ppl with bad credit acquire loans
It's the same as a bank
6
What is the best form of payment for a part-time employee at Best Buy?
Salary
Commission
Wages
Tip
7
A list of steps needed to reach a career goal
Plan of action
Steps to success
Things needed to do
8
A business with co-owners, in which both parties are legally joined together
Partnership
Entrepreneur
Sole proprietor
Cooperation
9
It's best to start saving for retirement when you're about 15 years away from retirement
False
True
10
What is a recession?
A period of time in which the economy goes down
A period of time in which the economy goes up
A period of prosperity
11
Which investment offers the lowest risk?
Bonds
Stocks
Savings Account
12
What is the primary reason to issue stock?
distribute the risk of bankruptcy across investors
to help investors earn high rate of returen
increase investor awareness of the company
to raise money to grow the company
13
The return investment (ROI) from education is typically the highest for:
Someone with a 2 year degreee
A high school graduate
a college applicant
someone with a 4-year degree
14
The form you complete to determine how much tax to withhold from your paycheck is the_______.
1099
1040 EZ
W-4
W-2
15
The largest secondary market for stocks/securities in the U.S, is the_________.
NASDAQ
Dow Jones
New York Stock Exchange
16
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
17
What type of investment has the highest risk?
Savings Account
Stocks
Bond
18
Identity thieves can use your personal information to
Sign up for electricity service
Open a credit card
Get a cell phone contract
All of the above
19
The ______ tells you how many years it will take an investment to double.
Doublemint twin rule
Rule of 72
bank
20
An installment loan is:
a loan paid off in one lump sum
a loan in which you make monthly payments
a loan from your mom that you will pay next month
21
What is liquidity in business?
water
money invested in a house
how quickly you can convert an asset to cash
22
What is the unauthorized use of a credit card?
using a credit card at the store
using a credit card at a gas pump
using a stolen credit card at a store
23
Which type of life insurance never expires?
Term
Whole
24
Which is better, a bull market or a bear market?
Bear
Bull
25
What is deflation?
When there is a reduction in the supply of money or credit
when the general level of prices goes up
The rate at which the general level of prices goes down
26
Which are the correct orders of investments from Lowest risk to Highest risk?
Stock−Treasury bond−Diversified mutual fund
Diversified mutual fund−Treasury bond−Stock
Treasury bond−Diversified mutual fund–Stock
Treasury bond−Stock−Diversified mutual fund
27
Using the FAFSA form,you can apply for:
the federal work study program
federal student loans
private loans
both a and b
28
When you buy insurance, you and the insurance company are_______________.
sharing the risk
breaking the law
entering into a contract
29
What is a mortgage?
a measure of your credit rating
A type of rent used to pay for housing
a type of loan used to buy property
a measure of the value of a home
30
Which asset is more liquid?
a house
money in a certificate of deposit
money in a savings account
31
Pay that is fixed amount regardless of hours worked
Tip
Salary
Bonus
32
Which institutions give loans?
payday lender
credit union
all
pawn shop
33
You should reconcile your checking account
every six months
when you get your monthly bank statement
once a year
every week
34
Which of the following are costs associated with owning car?
Insurance
Wear & tear fees
Fuel
Repairs
35
Committing money to an enterprise in order to earn a financial return is known as___.
Investing
salary
Plan of action
36
Renting provides_________flexibility but can lead to_________costs in the long-‐term
less;lower
less;higher
greater; higher
greater; lower
37
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
38
Which type of insurance requires you to have a Primary Care Physician?
HMO
PPO
39
Someone gets your tax documents. If this person is not caught, you will likely be a victim of _
identity theft
tax fraud
murder
40
Which of the following will charge the highest interest rate?
pawn shops and payday lenders
credit unions
Banks
41
What is a cashier's check?
A check you write to the bank
A check guaranteed by the bank that writes the check
A check you receive from your friend out of their checkbook
42
After you send in your FAFSA form,what will you receive back?
a copy's of your family's tax returns
your IRS date retrieval form
a copy of your complete FAFSA form
your student aid report
43
Pay that is figured under hourly rate
commission
Wage
Bonus
44
PAYMENTS OR PROPERTY GIVEN TO PEOPLE OR INSTITUTIONS, WHICH DO NOT HAVE TO BE PAID BACK
STOCK
GRANTS
BONDS
45
Jan pays $70 each month for her auto insurance policy.This regular payment is called a:
claim
deductible
co-pay
premium
46
Your
net worth
is the difference between the amount you own and the debts you owe.
True
False
47
When you purchase a municipal bond, you are:
loaning money to a municipality
investing in a index fund
diversifying your portfolio
48
An investment portfolio should always be diverse.
True
False
49
It's important to reconcile your checking account to make sure of mistakes
True
False
50
Insurance can help you:
reduce the chances of getting int an accident
cover all out of pocket costs
minimize monthly expenses
protect against unexpected accidents
51
Which document puts you at the least risk of identity theft?
Pre-approved credit card offers
Old tax records
Cash receipts
paycheck stubs
52
When you buy a ______________, you are loaning money to an organization.
Bond
Mutal Fund
Stock
Index Fund
53
Where can you find information about Financial Aid? Check all that apply
Online
Counselor
Town hall
College Financial Aid Officer
54
When you buy a ______________, you are loaning money to an organization.
Stock
Index Fund
Mutal Fund
Bond
55
Diversification is __________.
buying many different types of stocks to have less risk
safer than having a portfolio that isn't diversified
buying one type of stock
56
What is the best form of payment for a part-time employee at Best Buy?
Tip
salary
commission
wages
57
Which is cheaper, term or whole life insurance?
Whole
Term
58
What is the best form of payment for a waitress at Applebee's?
salary
wages
tip
59
When buying stock in a company, you are:
diversifying your portfolio
loaning money to a company
investing in an index fund
buying a portion of the company
60
When you purchase an item in a store, you may be charged__________.
income tax
capital gains tax
property tax
sales tax
61
Which loan type requires you to make loan payments while you’re attending school?
Neither a & b
Both a & b
Unsubsidized federal loan
Subsidized federal loan
62
A voluntary payment offered to an employee based on quality of service
salary
bond
tip
63
Which of the following is an advantage of federal student loans?
federal student loans do not accumulate interest
federal student loans have a fixed rate
federal student loans must be paid back while in school
64
Which earns you more money over time?
Simple interest
Compound interest
No interest
65
The best way to investigate fraudulent transactions on your credit card is to:
Review all old bank statements
Keep track of your monthly budget
Review your recent credit card statement
Keep a copy of your bank statements in a safer place
66
What is the safest way to dispose of old bank account statements?
Keep them bundled together in a folder
Throw them out in trash
Put them in the trash unopened
Shred them in a paper shredder
67
A bear market last longer than a bull market.
False
Ture
68
Municipal bonds are exempt from federal taxes and state taxes
True
False
69
The main trade-off that all investors must consider is:
diversity vs uniformity
stocks vs bonds
risk vs return
income vs cost
70
Which of the following are NOT deducted on a typical paystub:
Sales tax
Social security tax
State Income Tax
Medicare tax
71
A_________is generally considered an appreciating asset bcuz it will_________in value over time
car; decrease
car; increase
house; increase
house; decrease
72
Municipal bonds are exempt from federal taxes and state taxes
True
False
73
How much should you pay for coverage monthly? Premium $300 month; deductible $500
$300
$800
$200
$500
74
Which of the following is generally true about 401(k) and 403(b) retirement plans?
they restrict when you can withdraw your money
they offer some tax benefits
they are plans offered through employers
all the above
75
What are pensions and 401ks?
Ways to save for retirement
Taxes you pay
Insurance you buy
