Question 1

Carrie is trying to find a way to reduce her car insurance premium.She would be well advised to decrease her insurance policy's deductible.

Accepted Answer

A) True 
 B)False  False

Question 2

Hernando and Margarita have decided to take out an umbrella policy from an insurance company.The main reason they would probably want to do this would be to:

Accepted Answer

A) protect against major disasters,which are known as "rainy days." 
B) ensure that any children they have will be guaranteed the right to buy insurance at some future date. 
C) save money by having one company provide a variety of different types of coverage. 
D) take out one life insurance policy that covers both of them. 
A) protect against major disasters,which are known as "rainy days." 
B) ensure that any children they have will be guaranteed the right to buy insurance at some future date. 
C) save money by having one company provide a variety of different types of coverage. 
D) take out one life insurance policy that covers both of them. C

Question 3

________ insurance provides protection from losses of furniture,appliances,and clothes.

Accepted Answer

A) Term 
B) Health 
C) Disability 
D) Homeowner's 
A) Term 
B) Health 
C) Disability 
D) Homeowner's D

Question 4

The average lifetime income of someone with an undergraduate degree is about $1.6 million higher than for someone with only a high school diploma.

Accepted Answer

A) True 
 B)False

Question 5

Historically,the best place to invest has been in U.S.government savings bonds.

Accepted Answer

A) True 
 B)False

Question 6

A common purpose of a rider added to a homeowner's policy is to:

Accepted Answer

A) provide coverage for items that the standard policy does not cover. 
B) limit the insurance company's liability for certain types of losses. 
C) waive the provision that requires the owners to get a health exam. 
D) allow the policy holder to obtain health,disability,and auto insurance under their homeowner's plan. 
A) provide coverage for items that the standard policy does not cover. 
B) limit the insurance company's liability for certain types of losses. 
C) waive the provision that requires the owners to get a health exam. 
D) allow the policy holder to obtain health,disability,and auto insurance under their homeowner's plan.

Question 7

If you are in the 25 percent tax bracket and your home mortgage interest is $1000 per month,then your after-tax mortgage interest cost is $750 per month.

Accepted Answer

A) True 
 B)False

Question 8

Though stock prices do sometimes go down,investing in the stock market has generally provided very attractive returns over the long run.

Accepted Answer

A) True 
 B)False

Question 9

The path to success in a capitalist system is to:

Accepted Answer

A) spend more on capital goods than you do on consumer goods. 
B) have access to debt markets. 
C) have money to invest. 
D) work hard with the goal of moving up in the management of your employer. 
A) spend more on capital goods than you do on consumer goods. 
B) have access to debt markets. 
C) have money to invest. 
D) work hard with the goal of moving up in the management of your employer.

Question 10

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 11

In preparing an income statement for yourself,the wages from your job would be shown as:

Accepted Answer

A) your revenue. 
B) an expense. 
C) an asset. 
D) your owner's equity. 
A) your revenue. 
B) an expense. 
C) an asset. 
D) your owner's equity.

Question 12

For someone with a family that includes young children,the first step in estate planning should be to:

Accepted Answer

A) establish a will. 
B) set up a trust fund for each child. 
C) select a guardian for the children. 
D) give each child his or her own savings account. 
A) establish a will. 
B) set up a trust fund for each child. 
C) select a guardian for the children. 
D) give each child his or her own savings account.

Question 13

With respect to personal financial planning,the first thing to do with any extra money you have is to start a savings plan.

Accepted Answer

A) True 
 B)False

Question 14

Once you have set up a budget and handled your ordinary expenses,the first thing to do with any extra money you have is to:

Accepted Answer

A) start a savings plan. 
B) pay off your debts. 
C) start your own business. 
D) spend it on the things you would like but that aren't included in your budget. 
A) start a savings plan. 
B) pay off your debts. 
C) start your own business. 
D) spend it on the things you would like but that aren't included in your budget.

Question 15

Your personal balance sheet will reflect the same fundamental accounting equation as the balance sheet for a business: assets = liabilities + owners' equity.

Accepted Answer

A) True 
 B)False

Question 16

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

Accepted Answer

A) True 
 B)False

Question 17

One of the keys to financial success is never to apply for a credit card.

Accepted Answer

A) True 
 B)False

Question 18

A person using a credit card to make a purchase may end up paying much more than if he or she had paid cash.

Accepted Answer

A) True 
 B)False

Question 19

On your personal balance sheet,your assets should include anything of value that you own.

Accepted Answer

A) True 
 B)False

Question 20

More than half of all debtors seeking help at the National Consumer Counseling Service were between the ages of 18 and 32.

Accepted Answer

A) True 
 B)False

Exam 23: Bonus C: Managing Your Personal Finances

Carrie is trying to find a way to reduce her car insurance premium.She would be well advised to decrease her insurance policy's deductible.

Hernando and Margarita have decided to take out an umbrella policy from an insurance company.The main reason they would probably want to do this would be to:

________ insurance provides protection from losses of furniture,appliances,and clothes.

The average lifetime income of someone with an undergraduate degree is about $1.6 million higher than for someone with only a high school diploma.

Historically,the best place to invest has been in U.S.government savings bonds.

A common purpose of a rider added to a homeowner's policy is to:

If you are in the 25 percent tax bracket and your home mortgage interest is $1000 per month,then your after-tax mortgage interest cost is $750 per month.

Though stock prices do sometimes go down,investing in the stock market has generally provided very attractive returns over the long run.

The path to success in a capitalist system is to:

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.

In preparing an income statement for yourself,the wages from your job would be shown as:

For someone with a family that includes young children,the first step in estate planning should be to:

With respect to personal financial planning,the first thing to do with any extra money you have is to start a savings plan.

Once you have set up a budget and handled your ordinary expenses,the first thing to do with any extra money you have is to:

Your personal balance sheet will reflect the same fundamental accounting equation as the balance sheet for a business: assets = liabilities + owners' equity.

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

One of the keys to financial success is never to apply for a credit card.

A person using a credit card to make a purchase may end up paying much more than if he or she had paid cash.

On your personal balance sheet,your assets should include anything of value that you own.

More than half of all debtors seeking help at the National Consumer Counseling Service were between the ages of 18 and 32.

Taking Risks and Making Profits Within the Dynamic Business Environment

Understanding How Economics 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

Adapting Organizations to Todays Markets

Production and Operations Management

Motivating Employees

Human Resource Management: Finding and Keeping the Best Employees

Dealing With Employee-Management Issues and Relationships

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

Bonus A: Using Technology to Manage Information

Bonus B: Managing Risk

Appendix: Working Within the Legal Environment

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