Question 1

Which type of computation would a person use to determine the current value of a desired amount in the future?

Accepted Answer

A) Simple interest 
B) Future value of a single amount 
C) Future value of a series of deposits 
D) Present value of a single amount 
E) Compound interest 
A) Simple interest 
B) Future value of a single amount 
C) Future value of a series of deposits 
D) Present value of a single amount 
E) Compound interest D

Question 2

When prices are increasing at a rate of 6 percent,the cost of products would double in about how many years?

Accepted Answer

A) 7.2 years 
B) 10 years 
C) 6 years 
D) 12 years 
E) 18 years 
A) 7.2 years 
B) 10 years 
C) 6 years 
D) 12 years 
E) 18 years D

Question 3

As Cynthia Tyler plans to set aside funds for her young children's college education,she is setting a(n)____________ goal.

Accepted Answer

A) intermediate 
B) long-term 
C) short-term 
D) intangible 
E) durable 
A) intermediate 
B) long-term 
C) short-term 
D) intangible 
E) durable B

Question 4

The first step of the financial planning process is to:

Accepted Answer

A) develop financial goals. 
B) implement the financial plan. 
C) determine your current financial situation. 
D) review and revise your financial plan. 
E) create a financial action plan. 
A) develop financial goals. 
B) implement the financial plan. 
C) determine your current financial situation. 
D) review and revise your financial plan. 
E) create a financial action plan.

Question 5

What is meant by the term "Time Value of Money?"

Accepted Answer

Time value of money refers to the increa

Question 6

Trade balance is defined as the difference between a country's exports and its imports.

Accepted Answer

A) True 
 B)False

Question 7

Developing financial goals does not involve:

Accepted Answer

A) Analyzing your financial values several times a year 
B) Differentiating your needs from your wants 
C) Allowing others to decide which goals you should pursue 
D) Creating specific financial goals 
E) None of these 
A) Analyzing your financial values several times a year 
B) Differentiating your needs from your wants 
C) Allowing others to decide which goals you should pursue 
D) Creating specific financial goals 
E) None of these

Question 8

Who is most likely to benefit from inflation?

Accepted Answer

A) Retired people 
B) Lenders 
C) Borrowers 
D) Low-income consumers 
E) Government 
A) Retired people 
B) Lenders 
C) Borrowers 
D) Low-income consumers 
E) Government

Question 9

The changing cost of money when borrowing is referred to as ____________ risk.

Accepted Answer

A) Interest Rate 
B) Inflation 
C) Income 
D) Liquidity 
E) Personal 
A) Interest Rate 
B) Inflation 
C) Income 
D) Liquidity 
E) Personal

Question 10

When identifying alternative courses of action,possible courses of action include:

Accepted Answer

A) Continue with the same course of action 
B) Expand the past situation 
C) Change the past situation 
D)  Take an old course of action 
E) All of these 
A) Continue with the same course of action 
B) Expand the past situation 
C) Change the past situation 
D)  Take an old course of action 
E) All of these

Question 11

Opportunity cost refers to:

Accepted Answer

A) money needed for major consumer purchases. 
B) what a person gives up by making a choice. 
C) the amount paid for taxes when a purchase is made. 
D) current interest rates. 
E) evaluating different alternatives for financial decisions. 
A) money needed for major consumer purchases. 
B) what a person gives up by making a choice. 
C) the amount paid for taxes when a purchase is made. 
D) current interest rates. 
E) evaluating different alternatives for financial decisions.

Question 12

The annual price increase for consumer goods and services measured by the Bureau of Labor Statistics is called ________.

Accepted Answer

A) deflation 
B) inflation 
C) the consumer price index 
D) the price calculator 
E) the goods index 
A) deflation 
B) inflation 
C) the consumer price index 
D) the price calculator 
E) the goods index

Question 13

The following are examples of intangible goals,except:

Accepted Answer

A) obtaining a college degree. 
B) going on a cruise vacation. 
C) buying a house. 
D) losing weight. 
E) getting more sleep. 
A) obtaining a college degree. 
B) going on a cruise vacation. 
C) buying a house. 
D) losing weight. 
E) getting more sleep.

Question 14

Lynn Roy has decided to take retirement from her job and use the time she has earned to travel around the world.She has decided to start her trip around the world in Europe by train and bus and will use her savings to pay for her trip.Which step in the financial planning process does this scenario demonstrate?

Accepted Answer

A) Developing her financial goals 
B) Identifying alternative courses of action 
C) Evaluating her alternatives 
D) Implementing her financial plan 
E) Reviewing and revising her financial plan 
A) Developing her financial goals 
B) Identifying alternative courses of action 
C) Evaluating her alternatives 
D) Implementing her financial plan 
E) Reviewing and revising her financial plan

Question 15

Higher prices are likely to result from:

Accepted Answer

A) lower demand by consumers. 
B) increased production by business. 
C) lower interest rates. 
D) increased demand by consumers without increased supply. 
E) an increase in the supply of a product. 
A) lower demand by consumers. 
B) increased production by business. 
C) lower interest rates. 
D) increased demand by consumers without increased supply. 
E) an increase in the supply of a product.

Question 16

If you desire your savings to double in 6 years,what rate of return would you need to earn?

Accepted Answer

A) 6 percent 
B) 8 percent 
C) 9 percent 
D) 10 percent 
E) 12 percent Rule of 72, 72/x = 6, 6X = 72, 72/6 = 12 
A) 6 percent 
B) 8 percent 
C) 9 percent 
D) 10 percent 
E) 12 percent Rule of 72, 72/x = 6, 6X = 72, 72/6 = 12

Question 17

One aspect of financial planning is to buy stocks,bonds and mutual funds with the potential for long term growth.Which aspect of financial planning does this deal with?

Accepted Answer

A) Borrowing 
B) Spending 
C) Managing Risk 
D) Investing 
E) Retirement and Estate Planning 
A) Borrowing 
B) Spending 
C) Managing Risk 
D) Investing 
E) Retirement and Estate Planning

Question 18

____________ risk refers to the danger of changes in buying power during times of rising or falling prices.

Accepted Answer

A) Liquidity 
B) Income 
C) Personal 
D) Inflation 
E) Interest Rate 
A) Liquidity 
B) Income 
C) Personal 
D) Inflation 
E) Interest Rate

Question 19

During __________,even though prices decline,spending slows because consumers expect prices to continue to decline.

Accepted Answer

A) deflation 
B) depreciation 
C) appreciation 
D) economic recovery 
E) inflation 
A) deflation 
B) depreciation 
C) appreciation 
D) economic recovery 
E) inflation

Question 20

A major activity in the planning component of financial planning is:

Accepted Answer

A) selecting insurance coverage. 
B) evaluating investment alternatives. 
C) gaining occupational training and experience. 
D) allocating current resources for spending through budgeting. 
E) establishing a line of credit. 
A) selecting insurance coverage. 
B) evaluating investment alternatives. 
C) gaining occupational training and experience. 
D) allocating current resources for spending through budgeting. 
E) establishing a line of credit.

Which type of computation would a person use to determine the current value of a desired amount in the future?

When prices are increasing at a rate of 6 percent,the cost of products would double in about how many years?

As Cynthia Tyler plans to set aside funds for her young children's college education,she is setting a(n)____________ goal.

The first step of the financial planning process is to:

What is meant by the term "Time Value of Money?"

Trade balance is defined as the difference between a country's exports and its imports.

Developing financial goals does not involve:

Who is most likely to benefit from inflation?

The changing cost of money when borrowing is referred to as ____________ risk.

When identifying alternative courses of action,possible courses of action include:

Opportunity cost refers to:

The annual price increase for consumer goods and services measured by the Bureau of Labor Statistics is called ________.

The following are examples of intangible goals,except:

Higher prices are likely to result from:

If you desire your savings to double in 6 years,what rate of return would you need to earn?

One aspect of financial planning is to buy stocks,bonds and mutual funds with the potential for long term growth.Which aspect of financial planning does this deal with?

____________ risk refers to the danger of changes in buying power during times of rising or falling prices.

During __________,even though prices decline,spending slows because consumers expect prices to continue to decline.

A major activity in the planning component of financial planning is:

Financial Aspects of Career Planning

Money Management Strategy: Financial Statements and Budgeting

Planning Your Tax Strategy

Financial Services: Savings Plans and Payment Accounts

Introduction to Consumer Credit

Choosing a Source of Credit: The Costs of Credit Alternatives

Consumer Purchasing Strategies and Legal Protection

The Housing Decision: Factors and Finances

Property and Motor Vehicle Insurance

Health, Disability, and Long-Term Care Insurance

Life Insurance

Investing Fundamentals

Investing in Stock

Investing in Bonds

Investing in Mutual Funds

Investing in Real Estate and Other Investment Alternatives

Starting Early: Retirement Planning

Estate Planning

Filters

Exam 1: Personal Finance Basics and the Time Value of Money

Which type of computation would a person use to determine the current value of a desired amount in the future?

When prices are increasing at a rate of 6 percent,the cost of products would double in about how many years?

As Cynthia Tyler plans to set aside funds for her young children's college education,she is setting a(n)____________ goal.

The first step of the financial planning process is to:

What is meant by the term "Time Value of Money?"

Trade balance is defined as the difference between a country's exports and its imports.

Developing financial goals does not involve:

Who is most likely to benefit from inflation?

The changing cost of money when borrowing is referred to as ____________ risk.

When identifying alternative courses of action,possible courses of action include:

Opportunity cost refers to:

The annual price increase for consumer goods and services measured by the Bureau of Labor Statistics is called ________.

The following are examples of intangible goals,except:

Higher prices are likely to result from:

If you desire your savings to double in 6 years,what rate of return would you need to earn?

One aspect of financial planning is to buy stocks,bonds and mutual funds with the potential for long term growth.Which aspect of financial planning does this deal with?

____________ risk refers to the danger of changes in buying power during times of rising or falling prices.

During __________,even though prices decline,spending slows because consumers expect prices to continue to decline.

A major activity in the planning component of financial planning is:

Financial Aspects of Career Planning

Money Management Strategy: Financial Statements and Budgeting

Planning Your Tax Strategy

Financial Services: Savings Plans and Payment Accounts

Introduction to Consumer Credit

Choosing a Source of Credit: The Costs of Credit Alternatives

Consumer Purchasing Strategies and Legal Protection

The Housing Decision: Factors and Finances

Property and Motor Vehicle Insurance

Health, Disability, and Long-Term Care Insurance

Life Insurance

Investing Fundamentals

Investing in Stock

Investing in Bonds

Investing in Mutual Funds

Investing in Real Estate and Other Investment Alternatives

Starting Early: Retirement Planning

Estate Planning

Filters