Question 1

One step toward the goal of taking control of your finances is to keep track of all your expenses.

Accepted Answer

A) True 
 B)False

Question 2

One disadvantage of having credit cards for personal use is that

Accepted Answer

A)  they offer no protection if they are stolen. 
B)  they are less convenient than other forms of credit. 
C)  many companies have a policy that prevents employees from having both personal credit cards and credit cards for business use. 
D)  they can make it easy to pile up a large amount of debt quickly. 
A)  they offer no protection if they are stolen. 
B)  they are less convenient than other forms of credit. 
C)  many companies have a policy that prevents employees from having both personal credit cards and credit cards for business use. 
D)  they can make it easy to pile up a large amount of debt quickly.

Question 3

Term life insurance is a combination insurance plan and savings plan.

Accepted Answer

A) True 
 B)False

Question 4

Ricky wants to decrease his current taxable income and save for retirement. He should consider a traditional IRA.

Accepted Answer

A) True 
 B)False

Question 5

When purchasing with a credit card, it's important to remember that ________ if you do not pay the balance in full within a stated time period.

Accepted Answer

A)  the credit limit is reduced 
B)  no returns are allowed 
C)  interest is charged on the remaining balance 
D)  discounts are available 
A)  the credit limit is reduced 
B)  no returns are allowed 
C)  interest is charged on the remaining balance 
D)  discounts are available

Question 6

You should never borrow to cover regular expenses, but it makes perfectly good sense to use credit to cover unexpected expenses such as car or home repairs.

Accepted Answer

A) True 
 B)False

Question 7

Employers often match part of the contribution of their employees into a 401(k) retirement plan.

Accepted Answer

A) True 
 B)False

Question 8

Compare the basic features of the traditional IRA and Roth IRA.

Accepted Answer

Both the traditional and Roth IRAs offer

Question 9

A contrarian would advise you to buy stock when stock prices are falling and most other people are selling.

Accepted Answer

A) True 
 B)False

Question 10

Describe the major steps involved in estate planning.

Accepted Answer

For people with young children, the firs

Question 11

Casey wants to obtain life insurance at the lowest possible cost, but is leery of term insurance because she has heard the premiums tend to go up every few years. One way for her to avoid this concern would be to purchase multiyear level-premium insurance.

Accepted Answer

A) True 
 B)False

Question 12

Thomas contributed $2,800 to a Roth IRA. He is currently in the 25% tax bracket. How will his contribution affect his income tax for the current year?

Accepted Answer

A)  It will reduce the amount of taxes he owes in the current tax year by $700. 
B)  It will increase the amount of taxes he owes in the current year by $700. 
C)  It will reduce the amount of taxes he owes in the current year by $2,100. 
D)  It will have no effect on the amount of taxes he owes this year. 
A)  It will reduce the amount of taxes he owes in the current tax year by $700. 
B)  It will increase the amount of taxes he owes in the current year by $700. 
C)  It will reduce the amount of taxes he owes in the current year by $2,100. 
D)  It will have no effect on the amount of taxes he owes this year.

Question 13

About half of the U.S. population accumulates enough money to afford a comfortable retirement.

Accepted Answer

A) True 
 B)False

Question 14

A traditional IRA affords workers who qualify the opportunity to deduct from their reported income the money they put into a qualified retirement account.

Accepted Answer

A) True 
 B)False

Question 15

One strategy used to lower car insurance premiums is to choose a policy with a large deductible.

Accepted Answer

A) True 
 B)False

Question 16

Both the Roth and traditional IRA allow individuals to put as much money as they want into their retirement account.

Accepted Answer

A) True 
 B)False

Question 17

Personal financial planners recommend renting a home, rather than incurring the cost of buying a home.

Accepted Answer

A) True 
 B)False

Question 18

One strategy to lower the cost of automobile insurance is to purchase a policy with a

Accepted Answer

A)  low deductible. 
B)  high deductible. 
C)  liability coverage rider. 
D)  health coverage rider. 
A)  low deductible. 
B)  high deductible. 
C)  liability coverage rider. 
D)  health coverage rider.

Question 19

The best way to save money is to pay yourself first.

Accepted Answer

A) True 
 B)False

Question 20

Financial planning begins with

Accepted Answer

A)  spending money wisely. 
B)  earning money. 
C)  insuring your assets against an unexpected loss. 
D)  saving money. 
A)  spending money wisely. 
B)  earning money. 
C)  insuring your assets against an unexpected loss. 
D)  saving money.

Exam 24: Appendix: Managing Personal Finances

One step toward the goal of taking control of your finances is to keep track of all your expenses.

One disadvantage of having credit cards for personal use is that

Term life insurance is a combination insurance plan and savings plan.

Ricky wants to decrease his current taxable income and save for retirement. He should consider a traditional IRA.

When purchasing with a credit card, it's important to remember that ________ if you do not pay the balance in full within a stated time period.

You should never borrow to cover regular expenses, but it makes perfectly good sense to use credit to cover unexpected expenses such as car or home repairs.

Employers often match part of the contribution of their employees into a 401(k) retirement plan.

Compare the basic features of the traditional IRA and Roth IRA.

A contrarian would advise you to buy stock when stock prices are falling and most other people are selling.

Describe the major steps involved in estate planning.

Casey wants to obtain life insurance at the lowest possible cost, but is leery of term insurance because she has heard the premiums tend to go up every few years. One way for her to avoid this concern would be to purchase multiyear level-premium insurance.

Thomas contributed $2,800 to a Roth IRA. He is currently in the 25% tax bracket. How will his contribution affect his income tax for the current year?

About half of the U.S. population accumulates enough money to afford a comfortable retirement.

A traditional IRA affords workers who qualify the opportunity to deduct from their reported income the money they put into a qualified retirement account.

One strategy used to lower car insurance premiums is to choose a policy with a large deductible.

Both the Roth and traditional IRA allow individuals to put as much money as they want into their retirement account.

Personal financial planners recommend renting a home, rather than incurring the cost of buying a home.

One strategy to lower the cost of automobile insurance is to purchase a policy with a

The best way to save money is to pay yourself first.

Financial planning begins with

Taking Risks and Making Profits Within the Dynamic Business Environment

Understanding Economics and How It Affects Business

Doing Business in Global Markets

Demanding Ethical and Socially Responsible Behavior

How to Form a Business

Entrepreneurship and Starting a Small Business

Management and Leadership

Structuring Organizations for Todays Challenges

Production and Operations Management

Motivating Employees

Human Resource Management: Finding and Keeping the Best Employees

Dealing With Employeemanagement Issues

Marketing: Helping Buyers Buy

Developing and Pricing Goods and Services

Distributing Products

Using Effective Promotions

Understanding Accounting and Financial Information

Financial Management

Using Securities Markets for Financing and Investing Opportunities

Money, Financial Institutions, and the Federal Reserve

Appendix: Working Within the Legal Environment

Appendix: Using Technology to Manage Information

Appendix: Managing Risk

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