Question 1

Compared to the stocks of larger firms, the stocks of smaller firms are

Accepted Answer

A)  less volatile. 
B)  more volatile. 
C)  more liquid. 
D)  safer. 
A)  less volatile. 
B)  more volatile. 
C)  more liquid. 
D)  safer.

Question 2

One disadvantage of investing in retirement accounts is that these funds are typically not very liquid.

Accepted Answer

A) True 
 B)False

Question 3

Maintaining a "rainy day fund" is another way of making sure you have adequate

Accepted Answer

A)  liquidity. 
B)  life insurance. 
C)  property insurance. 
D)  foul weather gear. 
A)  liquidity. 
B)  life insurance. 
C)  property insurance. 
D)  foul weather gear.

Question 4

A budget is not intended to help you determine

Accepted Answer

A)  how much money you will have at the end of each month. 
B)  a plan for spending all of your income on current needs. 
C)  how much you can allocate for the future. 
D)  how to prevent excessive spending to achieve financial goals. 
A)  how much money you will have at the end of each month. 
B)  a plan for spending all of your income on current needs. 
C)  how much you can allocate for the future. 
D)  how to prevent excessive spending to achieve financial goals.

Question 5

The purpose of insurance is to protect your

Accepted Answer

A)  liabilities and expenses. 
B)  assets and liabilities. 
C)  assets and net worth. 
D)  income and expenses. 
A)  liabilities and expenses. 
B)  assets and liabilities. 
C)  assets and net worth. 
D)  income and expenses.

Question 6

Which of the following should you do first?

Accepted Answer

A)  Invest in liquid assets 
B)  Pay off loans 
C)  Buy insurance 
D)  Make investments 
A)  Invest in liquid assets 
B)  Pay off loans 
C)  Buy insurance 
D)  Make investments

Question 7

Matt is 25 and wants to save $2,000 per year in an IRA until he retires at age 65. If Matt's investment earns 9%, how much will his IRA be worth when he retires?

Accepted Answer

A)  $64,030 
B)  $579,471 
C)  $272,620 
D)  $675,780 
A)  $64,030 
B)  $579,471 
C)  $272,620 
D)  $675,780

Question 8

Bill and Jan are reviewing their current financial plan. They have decided that it is time obtain life insurance and begin contributing to an investment fund for college. Bill and Jan are

Accepted Answer

A)  a young, dual-income couple with no children. 
B)  young and single. 
C)  a young couple with children under the age of 18. 
D)  an older couple with no dependent children living at home. 
A)  a young, dual-income couple with no children. 
B)  young and single. 
C)  a young couple with children under the age of 18. 
D)  an older couple with no dependent children living at home.

Question 9

When you borrow on a mortgage to buy a new home, the lender will require you to purchase

Accepted Answer

A)  life insurance. 
B)  homeowner's insurance. 
C)  disability insurance. 
D)  The lender will require you to purchase all three types of insurance to protect their loan. 
A)  life insurance. 
B)  homeowner's insurance. 
C)  disability insurance. 
D)  The lender will require you to purchase all three types of insurance to protect their loan.

Question 10

If you are a high-income individual, investing in ________ will reduce your tax bill.

Accepted Answer

A)  stocks that pay cash dividends 
B)  growth stocks 
C)  municipal bonds 
D)  global mutual funds 
A)  stocks that pay cash dividends 
B)  growth stocks 
C)  municipal bonds 
D)  global mutual funds

Question 11

Use the following two columns of items to answer the matching questions below:
-current liabilities
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

What are four types of financial investment balances that you should monitor?

Accepted Answer

Market value of stoc

Question 13

You are single and live in a furnished apartment. Which of the following are you most likely to need?

Accepted Answer

A)  Stockbroker 
B)  Life insurance 
C)  A will 
D)  A budget 
A)  Stockbroker 
B)  Life insurance 
C)  A will 
D)  A budget

Question 14

Mary Kay has a child who will start college in 10 years. She plans to set aside $2,400 per year for her child's education during this period and estimates she will earn an annual rate of 8%. How much will Mary Kay have available for her child's education in 10 years?

Accepted Answer

A)  $24,000 
B)  $27,446 
C)  $34,769 
D)  $29,971 
A)  $24,000 
B)  $27,446 
C)  $34,769 
D)  $29,971

Question 15

Use the following two columns of items to answer the matching questions below:
-insurance

Accepted Answer

A) a place to store your financial documents 
B) a loan to purchase a home or condominium 
C) amount saved for the future 
D) asset and income protection 
A) a place to store your financial documents 
B) a loan to purchase a home or condominium 
C) amount saved for the future 
D) asset and income protection

Question 16

It is easier to make monthly loan payments if you select financing that has relatively ________ maturities.

Accepted Answer

The answer of It is easier to make monthly loan...

Question 17

If you want periodic income, which of the following investments should you purchase?

Accepted Answer

A)  Bonds 
B)  Stocks that pay cash dividends 
C)  Mutual funds 
D)  Both A and B are correct 
A)  Bonds 
B)  Stocks that pay cash dividends 
C)  Mutual funds 
D)  Both A and B are correct

Question 18

Which of the following statements is not true?

Accepted Answer

A)  You should use all of your liquid assets to pay off loans. 
B)  Paying off loans is appropriate when the interest rate is relatively high. 
C)  Paying off loans is wise when the expected rate you will earn on investments is lower than the interest rate on the loan. 
D)  Loan payments you make restrict your spending and saving and may prevent you from achieving financial goals. 
A)  You should use all of your liquid assets to pay off loans. 
B)  Paying off loans is appropriate when the interest rate is relatively high. 
C)  Paying off loans is wise when the expected rate you will earn on investments is lower than the interest rate on the loan. 
D)  Loan payments you make restrict your spending and saving and may prevent you from achieving financial goals.

Question 19

Purposes of managing liquidity include all of the following, except

Accepted Answer

A)  determining how to keep the majority of your assets in liquid form. 
B)  having enough liquid assets to cover cash shortages. 
C)  maintaining adequate liquidity to avoid borrowing every time you need money. 
D)  maintaining just enough liquid assets to meet your needs. 
A)  determining how to keep the majority of your assets in liquid form. 
B)  having enough liquid assets to cover cash shortages. 
C)  maintaining adequate liquidity to avoid borrowing every time you need money. 
D)  maintaining just enough liquid assets to meet your needs.

Question 20

Which of the following investments achieves the greatest diversification?

Accepted Answer

A)  Stocks 
B)  Bonds 
C)  Mutual funds 
D)  Savings accounts 
A)  Stocks 
B)  Bonds 
C)  Mutual funds 
D)  Savings accounts

Compared to the stocks of larger firms, the stocks of smaller firms are

One disadvantage of investing in retirement accounts is that these funds are typically not very liquid.

Maintaining a "rainy day fund" is another way of making sure you have adequate

A budget is not intended to help you determine

The purpose of insurance is to protect your

Which of the following should you do first?

Matt is 25 and wants to save $2,000 per year in an IRA until he retires at age 65. If Matt's investment earns 9%, how much will his IRA be worth when he retires?

Bill and Jan are reviewing their current financial plan. They have decided that it is time obtain life insurance and begin contributing to an investment fund for college. Bill and Jan are

When you borrow on a mortgage to buy a new home, the lender will require you to purchase

If you are a high-income individual, investing in ________ will reduce your tax bill.

What are four types of financial investment balances that you should monitor?

You are single and live in a furnished apartment. Which of the following are you most likely to need?

Mary Kay has a child who will start college in 10 years. She plans to set aside $2,400 per year for her child's education during this period and estimates she will earn an annual rate of 8%. How much will Mary Kay have available for her child's education in 10 years?

Use the following two columns of items to answer the matching questions below: -insurance

It is easier to make monthly loan payments if you select financing that has relatively ________ maturities.

If you want periodic income, which of the following investments should you purchase?

Which of the following statements is not true?

Purposes of managing liquidity include all of the following, except

Which of the following investments achieves the greatest diversification?

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

Compared to the stocks of larger firms, the stocks of smaller firms are

One disadvantage of investing in retirement accounts is that these funds are typically not very liquid.

Maintaining a "rainy day fund" is another way of making sure you have adequate

A budget is not intended to help you determine

The purpose of insurance is to protect your

Which of the following should you do first?

Matt is 25 and wants to save $2,000 per year in an IRA until he retires at age 65. If Matt's investment earns 9%, how much will his IRA be worth when he retires?

Bill and Jan are reviewing their current financial plan. They have decided that it is time obtain life insurance and begin contributing to an investment fund for college. Bill and Jan are

When you borrow on a mortgage to buy a new home, the lender will require you to purchase

If you are a high-income individual, investing in ________ will reduce your tax bill.

What are four types of financial investment balances that you should monitor?

You are single and live in a furnished apartment. Which of the following are you most likely to need?

Mary Kay has a child who will start college in 10 years. She plans to set aside $2,400 per year for her child's education during this period and estimates she will earn an annual rate of 8%. How much will Mary Kay have available for her child's education in 10 years?

Use the following two columns of items to answer the matching questions below: -insurance

It is easier to make monthly loan payments if you select financing that has relatively ________ maturities.

If you want periodic income, which of the following investments should you purchase?

Which of the following statements is not true?

Purposes of managing liquidity include all of the following, except

Which of the following investments achieves the greatest diversification?

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