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Personal Finance Final Exam Review Flashcards | StudBud
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Personal Finance Final Exam Review
Personal Finance Final Exam Review
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Financial Literacy Exam review
Flashcards
40 cards
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Practice quiz
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Questions
40
Answers
1
What factor influences auto insurance rates?
car contents
driving record
health practices
car color
2
Individuals with more formal educational training usually have:
higher estimated lifetime earnings
lower personal satisfaction
more comfortable work environment
greater amounts of leisure time
3
If you are saving $25 a week for 3 months to buy a new xbox, this is an example of:
educational goal
short term goal
A need
Long term goal
4
What is
net pay
if earn $10/hr for 40 hrs and deductions: $50 Fed Inc. tax, $20 state & $30 SS
$300
$350
$400
$330
5
Government uses money collected from taxes to:
Encourage private enterprise
establish food networks
finance Internal Revenue Service
Provide goods and services to public
6
$500 damage to your car with a $200 deductible, What will insurance company pay?
$0
$200
$500
$300
7
A positive net worth is:
income is less than savings
assets are less than liabilities
income is greater than savings
assets are greater than liabilities
8
A thief takes your credit card and runs up $2000. How much are you responsible for?
Liable for the entire $2000
You are limited to $50
Your liability depends on the user is caught
Not liable for any of it
9
Susan works f/t at handy dandy hardware. Who pays FICA (social security) contributions?
Susan only
trhe federal government
susan and her employer
her employer only
10
What is a non-contractual expense?
gasoline
internet bill
car payment
cell phone bill
11
What are the 3 things creditors consider to be most important?
marital status gender location
character collateral capacity
occupation connections income sources
length of loan credibility commissions
12
You counsellor asked you to set some academic goals, you are most likely to accomplish them if:
You think about them weekly
You tell your friends about them.
You discuss with your parents
you write them down
13
Pay yourself first means that:
money is set aside for savings before spending
fixed expenses paid before flexible expenses
credit cards pay for what you don't have as income
all bills bet paid before any savings
14
Human capital can be defined as:
fees paid to take college classes
skills acquired through learning and volunteering
type of work a person performs
Money earned through human labor
15
Rule of 72: How many years for $1000 to become $2000 at interest rate 7.2%.
14.4
20
7.2
10
16
Liquidity risk is highest for which type of investment?
mutual fund
savings account
individual stocks
real estate
17
Which is typically true?
peoples choices have consequences for the future
people do not respond to incentives
voluntary trade causes winners and losers
Correct choices have no cost
18
What is the relationship between risk and reward?
uncertain realtionship
higher the risk higher the reward
higher risk lower the reward
amount of risk doesn't influence reward
19
Money collected from taxes goes to:
establish food networks
provides goods and services to the public
encourage private enterprise
finance IRS
20
What is a diversified portfolio?
invests in all the same time of company
invests in a variety of investment types
increased risk/retun ratio
limits investing choices to two
21
An example of a need and want is:
designer clothing and a vacation
adequate shelter and laptop
basic clothing and adequate shelter
new automobile and basic clothing
22
What is an element of a financial goal?
time bound
specific
all of the above
realistic
23
What are the consequences of a trade-off when you purchased a concert ticket but your car needed new tires on your car?
She will have to wait until she gets enough money to buy new tires.
The concert was less expensive than the tires.
The tires can wait until later but the concert is only one time.
24
When your car is worth less than what you owe is called"
on top of the loan
underside of the loan
depreciation
upside down on the loan
25
Electronic banking allows consumer to:
eliminate the need to reconcile acct
have 24/7 access to banking transactions
havre 3-4 day float time on checks
correct fraud or identity theft
26
Key advantage of getting credit is that is can help people:
reduce risk when investing
buy a good or service today and pay for it later
sell assets
increase net worth
27
How can you avoid paying interest on a credit card?
Transfer the balance to another card
Pay the balance in full every month
Pay the minimum every month
Interest is always paid
28
Disposable income is money that:
saved and invested each month
deducted from your income
spent or saved after deductions
budgeted for expenses
29
If Jessica chooses to buy more auto insurance this year then she probably decided that:
Benefits of more insurance are greater than the cost
she will drive more safely in the future
more insurance will reduce risk of accident
added insurance will help her savings grow faster
30
Example of closed-end credit:
car loan
Store credit account
credit card
31
The best indicator of the cost of the loan is the:
annual percentage rate
number of payments
monthly payment
amount of down payment
32
What is the main function of a credit bureau?
provides advice on how to use credit
send warnings to people in credit trouble
extends credit to qualified buyers
tracks the bill paying habits of customers
33
To increase your net worth you should:
Increase market value
Decrease assets
Increase assets
Increase liabilities
34
Before renting what do you need to do:
receive the mortgage and pay down payment
pay utility bill
pay security deposit and sign a lease
get renter's insurance
35
What is a need?
unnecessary but desired
A necessity for life
a fundamental belief or practice about what is important
the end result of something
36
A co-signor is a person who:
applying for a loan
guaranteeing loan repayment
loaning money to a consume
paying with cash
37
Human capital consists of
knowledge and skills
plant and equipment
stocks and bonds
savings and investments
38
What is the difference between gross pay and net pay?
net pay is gross minus savings
gross pay is net pay minus deductions
net pay is gross pay minus deductions
gross pay is net pay minus savings
39
Ways to find out about jobs is contact with friends and family members is called
connecting
recruiting
logrolling
networking
40
Which savings tools is best for everyday purchases?
Certificate of Deposit
Money market account
checking account
all of the above
