Question 1

Which of the following best explains why some consumers have difficulty creating and sticking to a budget?

Accepted Answer

A)  They don't make enough money. 
B)  They can't determine their cash outflows. 
C)  They spend excessively due to the need for immediate satisfaction. 
D)  They have difficulty making decisions about their financing. 
A)  They don't make enough money. 
B)  They can't determine their cash outflows. 
C)  They spend excessively due to the need for immediate satisfaction. 
D)  They have difficulty making decisions about their financing. C

Question 2

The idea of having adequate insurance is to protect against events that could reduce your income or wealth.

Accepted Answer

A) True 
 B)False  True

Question 3

Insurance protects against events that could reduce

Accepted Answer

A)  your income. 
B)  your chances of an accident. 
C)  your wealth. 
D)  Both A and C are correct. 
A)  your income. 
B)  your chances of an accident. 
C)  your wealth. 
D)  Both A and C are correct. D

Question 4

What are three types of financing you have studied?

Accepted Answer

Credit cards, personal loans,

Question 5

You should invest in ________ if you need periodic income.

Accepted Answer

bonds or d

Question 6

Loans restrict your spending or saving in future months and, therefore, can prevent you from achieving financial goals.

Accepted Answer

A) True 
 B)False

Question 7

To increase your net worth, you should

Accepted Answer

A)  pay off bills. 
B)  spend your money carefully. 
C)  invest in appreciating assets. 
D)  Both A and C are correct. 
A)  pay off bills. 
B)  spend your money carefully. 
C)  invest in appreciating assets. 
D)  Both A and C are correct.

Question 8

A financial plan should be

Accepted Answer

A)  prepared when you graduate from college and carefully followed thereafter without changes. 
B)  prepared when you graduate from college and carefully followed until you retire when you will no longer need one. 
C)  prepared when you graduate from college and reviewed/adjusted as events such as marriage, job changes, birth of children, and retirement necessitate. 
D)  prepared only in a rough outline as it will change too often to make anything more detailed feasible. 
A)  prepared when you graduate from college and carefully followed thereafter without changes. 
B)  prepared when you graduate from college and carefully followed until you retire when you will no longer need one. 
C)  prepared when you graduate from college and reviewed/adjusted as events such as marriage, job changes, birth of children, and retirement necessitate. 
D)  prepared only in a rough outline as it will change too often to make anything more detailed feasible.

Question 9

The key factor to be considered before investing in municipal bonds is

Accepted Answer

A)  they are financially advantageous mainly to high tax rate investors. 
B)  they are generally not as liquid as high-grade corporate bonds. 
C)  in order to diversify you should invest in a municipal bond fund rather than specific bonds. 
D)  All of the above are key considerations. 
A)  they are financially advantageous mainly to high tax rate investors. 
B)  they are generally not as liquid as high-grade corporate bonds. 
C)  in order to diversify you should invest in a municipal bond fund rather than specific bonds. 
D)  All of the above are key considerations.

Question 10

You should maintain just enough money in liquid assets to satisfy your liquidity needs so you can earn a higher return on your other assets.

Accepted Answer

A) True 
 B)False

Question 11

Use the following two columns of items to answer the matching questions below:
-liquid assets
A)planning for insurance, investing, financing, and retirement
B)amounts owed that are due in less than one year
C)cash, checking account, and money market account
D)stocks, bonds and mutual funds
E)home, car, furniture
F)assets less liabilities

Accepted Answer

The answer of Use the following two columns of items...

Question 12

Some retirement plans, such as Roth IRAs, are more liquid than other plans.

Accepted Answer

A) True 
 B)False

Question 13

Financial statements include all of the following, except a(n)

Accepted Answer

A)  balance sheet. 
B)  income statement. 
C)  cash flow statement. 
D)  asset allocation statement. 
A)  balance sheet. 
B)  income statement. 
C)  cash flow statement. 
D)  asset allocation statement.

Question 14

If your goal is to save for retirement, which of the following investments would you not consider?

Accepted Answer

A)  401(k) plan 
B)  Traditional IRA 
C)  Profit-sharing plan 
D)  Intermediate term certificate of deposit 
A)  401(k) plan 
B)  Traditional IRA 
C)  Profit-sharing plan 
D)  Intermediate term certificate of deposit

Question 15

To monitor your financial plan over time, it is important to store finance-related documents in a safe and accessible place.

Accepted Answer

A) True 
 B)False

Question 16

In deciding how much to contribute to your retirement account, which of the following should you least consider?

Accepted Answer

A)  Anticipated inheritances 
B)  Other financial goals 
C)  Liquidity needs 
D)  Current expenses 
A)  Anticipated inheritances 
B)  Other financial goals 
C)  Liquidity needs 
D)  Current expenses

Question 17

Use the following two columns of items to answer the matching questions below:
-financial plan
A)planning for insurance, investing, financing, and retirement
B)amounts owed that are due in less than one year
C)cash, checking account, and money market account
D)stocks, bonds and mutual funds
E)home, car, furniture
F)assets less liabilities

Accepted Answer

The answer of Use the following two columns of items...

Question 18

One disadvantage of financing is

Accepted Answer

A)  interest payments are tax-deductible. 
B)  it allows you to make purchases without having adequate cash available. 
C)  it can cause budgeting problems. 
D)  it allows you to have more money in the future. 
A)  interest payments are tax-deductible. 
B)  it allows you to make purchases without having adequate cash available. 
C)  it can cause budgeting problems. 
D)  it allows you to have more money in the future.

Question 19

________ should be kept in a safe at home or in a safety deposit box at a bank.

Accepted Answer

The answer of ________ should be kept in a safe...

Question 20

Which of the following assets will not increase your liquidity?

Accepted Answer

A)  Checking account 
B)  Money market mutual fund 
C)  Cash in a traditional IRA 
D)  Cash in your wallet 
A)  Checking account 
B)  Money market mutual fund 
C)  Cash in a traditional IRA 
D)  Cash in your wallet

Which of the following best explains why some consumers have difficulty creating and sticking to a budget?

The idea of having adequate insurance is to protect against events that could reduce your income or wealth.

Insurance protects against events that could reduce

What are three types of financing you have studied?

You should invest in ________ if you need periodic income.

Loans restrict your spending or saving in future months and, therefore, can prevent you from achieving financial goals.

To increase your net worth, you should

A financial plan should be

The key factor to be considered before investing in municipal bonds is

You should maintain just enough money in liquid assets to satisfy your liquidity needs so you can earn a higher return on your other assets.

Some retirement plans, such as Roth IRAs, are more liquid than other plans.

Financial statements include all of the following, except a(n)

If your goal is to save for retirement, which of the following investments would you not consider?

To monitor your financial plan over time, it is important to store finance-related documents in a safe and accessible place.

In deciding how much to contribute to your retirement account, which of the following should you least consider?

One disadvantage of financing is

________ should be kept in a safe at home or in a safety deposit box at a bank.

Which of the following assets will not increase your liquidity?

Overview of a Financial Plan

Planning With Personal Financial Statements

Applying Time Value Concepts

Using Tax Concepts for Planning

Banking and Interest Rates

Managing Your Money

Assessing and Securing Your Credit

Managing Your Credit

Personal Loans

Purchasing and Financing a Home

Auto and Homeowners Insurance

Health and Disability Insurance

Life Insurance

Investing Fundamentals

Investing in Stocks

Investing in Bonds

Investing in Mutual Funds

Asset Allocation

Retirement Planning

Estate Planning

Filters

Exam 21: Integrating the Components of a Financial Plan

Which of the following best explains why some consumers have difficulty creating and sticking to a budget?

The idea of having adequate insurance is to protect against events that could reduce your income or wealth.

Insurance protects against events that could reduce

What are three types of financing you have studied?

You should invest in ________ if you need periodic income.

Loans restrict your spending or saving in future months and, therefore, can prevent you from achieving financial goals.

To increase your net worth, you should

A financial plan should be

The key factor to be considered before investing in municipal bonds is

You should maintain just enough money in liquid assets to satisfy your liquidity needs so you can earn a higher return on your other assets.

Some retirement plans, such as Roth IRAs, are more liquid than other plans.

Financial statements include all of the following, except a(n)

If your goal is to save for retirement, which of the following investments would you not consider?

To monitor your financial plan over time, it is important to store finance-related documents in a safe and accessible place.

In deciding how much to contribute to your retirement account, which of the following should you least consider?

One disadvantage of financing is

________ should be kept in a safe at home or in a safety deposit box at a bank.

Which of the following assets will not increase your liquidity?

Overview of a Financial Plan

Planning With Personal Financial Statements

Applying Time Value Concepts

Using Tax Concepts for Planning

Banking and Interest Rates

Managing Your Money

Assessing and Securing Your Credit

Managing Your Credit

Personal Loans

Purchasing and Financing a Home

Auto and Homeowners Insurance

Health and Disability Insurance

Life Insurance

Investing Fundamentals

Investing in Stocks

Investing in Bonds

Investing in Mutual Funds

Asset Allocation

Retirement Planning

Estate Planning

Filters