Deck 2: Focus On: Improving Your Financial Health

Question 1

What is a loan principal?

A)the fee on a loan
B)the amount owed on a loan
C)the interest rate paid on a loan
D)the interest payment on a loan

Answer 1

the amount owed on a loan

Question 2

What is one advantage of debt?

A)It allows large projects to be built.
B)It discourages borrowing.
C)It encourages borrowing.
D)It contributes to recessions.

Answer 2

It allows large projects to be built.

Question 3

Which of the following statements about financial concerns in college is TRUE?

A)Nearly one-fourth of college students report that they worry often or very often about meeting regular expenses.
B)Only one-third of first-time college students complete their degree in 6 to 8 years.
C)Almost one-half of college students report that financial aid is a major factor in determining which college they attend.
D)The average cost of tuition and fees at public four-year colleges nearly doubled between 2010 and 2015.

Answer 3

Almost one-half of college students report that financial aid is a major factor in determining which college they attend.

Question 4

When you earn more than you spend,you have a budget

A)surplus.
B)deficit.
C)shortfall.
D)liability.

Question 5

George earns a good salary and rents an apartment that is within his means,yet every month,he runs short of money.What should he do?

A)Set budget goals to clarify his situation.
B)Track his income to find out why he doesn't have enough money.
C)Track his expenses to figure out why his spending exceeds his income.
D)Take out a loan to make sure he has money left over at the end of the month.

Question 6

Lower socioeconomic status is associated with

A)lower rates of smoking.
B)lower rates of asthma.
C)higher rates of smoking.
D)higher-than-average longevity.

Question 7

Discretionary spending is the opposite of ________ spending.

A)excess
B)necessary
C)entitlement
D)recreational

Question 8

A common reason for students to drop out of college is

A)that they have been offered a high-paying job.
B)stress-related illness.
C)concern about growing debt.
D)parental pressure to enter the workforce.

Question 9

Which of the following is a good way to cut spending and keep to your budget?

A)Drive more rather than taking the bus.
B)Eat out rather than cooking at home.
C)Use cash rather than credit cards.
D)Avoid texting on Wi-Fi networks.

Question 10

Student aid includes all of the following EXCEPT

A)loans.
B)grants.
C)credit.
D)work study.

Question 11

Credit is essentially the same as

A)debt.
B)a loan.
C)interest.
D)principal.

Question 12

On average,about what percentage of college costs are paid for with borrowed funds?

A)12%
B)22%
C)32%
D)42%

Question 13

Juana is a junior in college and receives scholarship funds at the beginning of each semester.In the past,this money has been sufficient to cover her costs each term.But this fall she ran out of money before the term was over.Which of the following is the MOST sensible step she can take to make sure she doesn't run out in the spring?

A)Create a budget to help her smooth out her spending and avoid surprises.
B)Drop one of her classes and get a job to add to her income.
C)Request a cost of living increase in her scholarship funds.
D)Track her income to see where the money is going.

Question 14

Relative deprivation is

A)the inability of lower-income groups to sustain the same lifestyle as higher-income groups in the same community.
B)discrimination against lower-income people by higher-income people within the same community.
C)the cluster of physical and emotional manifestations-such as higher rates of type 2 diabetes and alcohol abuse-seen in lower-income groups in a community.
D)a sense of low self-esteem experienced by people living in poverty.

Question 15

Which of the following countries BEST demonstrates the link between high GDP per capita and long life expectancy?

A)Brazil
B)Japan
C)Russia
D)Mexico

Question 16

A principal reason for making a budget is to

A)earn more money.
B)pay bills on time.
C)qualify for a bank loan.
D)know how much you can afford to spend.

Question 17

For students,a federal loan is usually preferable to a private loan because

A)it is easier to obtain.
B)interest rates tend to be variable.
C)interest rates tend to be lower.
D)repayment timelines are shorter.

Question 18

Soraya is trying to avoid running out of money every month.She has asked her employer to deposit her paycheck directly into her bank account.She has also cut back on expenses by eating out just once a week,driving her car as little as possible,and limiting visits to her favorite coffee shop.She has also put all discretionary purchases on her credit card so that she can pay for everything at the end of the month.What do you think she should do to avoid running out of money every month?

A)She should eat out less.
B)She should drive more and spend less on public transportation.
C)She should have her paycheck mailed to her so she can deposit it herself.
D)She should not use her credit card so much,but instead rely more on cash purchases.

Question 19

Gustavo is going to start college next year and is considering a financial aid package that includes a federal loan,a private loan,a grant,and work study.What are his two BEST options in that package if he wants to keep his costs down?

A)the federal loan and private loan
B)the federal loan and work study
C)the grant and work study
D)the federal loan and grant

Question 20

All of the following qualify as budget expenses EXCEPT

A)rent payments.
B)utility payments.
C)insurance premiums.
D)stipends from relatives.

Question 21

Recent changes in credit card rules can be obtained from the

A)Consumer Financial Protection Bureau.
B)Banking and Commerce Committee.
C)Federal Trade Commission.
D)U)S.Chamber of Commerce.

Question 22

To check your credit report,start by contacting the

A)Interstate Commerce Commission.
B)Department of the Treasury.
C)Department of Commerce.
D)Federal Trade Commission.

Question 23

Approximately how many Americans were affected by identity theft in 2013?

A)13,000
B)130,000
C)1)3 million
D)13 million

Question 24

Why might a person's first credit card have a high APR?

A)lack of credit history
B)long credit history
C)high credit score
D)low credit limit

Question 25

Credit scores are based on all of the following EXCEPT

A)current debt.
B)total credit available.
C)marital status.
D)credit history.

Question 26

Why is a low credit score problematic?

A)It leads to penalties.
B)It makes it more difficult to borrow.
C)It lowers your interest rate.
D)It raises your credit limit.

Question 27

What was the financial loss to Americans from identity theft in 2013?

A)$3.8 million
B)$48 million
C)$18 billion
D)$28 billion

Question 28

Why is identity theft more commonly experienced by users of social media?

A)Social media websites are hacked often.
B)Social media companies engage in fraud.
C)Social media users often share private information online.
D)Social media sites download computer viruses onto personal computers.

Question 29

The starting point in shopping for a credit card is to find out the

A)annual percentage rate.
B)source of the card.
C)grace period.
D)credit limit.

Question 30

To reduce college costs,more than 40 percent of students live at home or with a relative.

Question 31

If your ATM or debit card is stolen and used,you be responsible for all charges put on the card if you fail to report the theft within

A)30 days.
B)60 days.
C)90 days.
D)120 days.

Question 32

A credit card is a(n)________ loan.

A)secured
B)unsecured
C)permanent
D)impermanent

Question 33

Fees associated with credit cards include all of the following EXCEPT

A)cash advance fees.
B)annual fees.
C)grace fees.
D)late fees.

Question 34

What does a credit score evaluate?

A)how likely a person is to default on a loan
B)the length of a person's credit history
C)the amount of debt a person has
D)the number of credit cards a person holds

Question 35

If your ATM or debit card is stolen and used,you will be liable for no more than $50 in charges if you report the theft within how many business days?

A)2
B)3
C)4
D)5

Question 36

What is one benefit of having a credit card?

A)You can spend without limits.
B)You won't pay interest charges.
C)You may qualify for free rental cars or hotel rooms.
D)You may receive purchase protection on products.

Question 37

Financial status has no relation to an individual's health.

Question 38

Which of the following rules was included in the 2009 CARD Act,designed to regulate the credit card industry?

A)Interest rates on credit cards cannot be raised.
B)You must be at least 21 years old to get a credit card.
C)Students can receive gifts when they apply for credit cards.
D)Colleges must disclose marketing contracts with credit card companies.

Question 39

All of the following actions can help protect against identity theft EXCEPT

A)shredding credit card statements to remove account numbers.
B)password locking your smart phone and PC.
C)not responding to phishing schemes.
D)not getting a smart card.

Question 40

What is phishing?

A)an email scam used to seek personal financial information
B)a computer virus
C)a phony credit card application
D)a fraudulent credit report offer

Question 41

Identify five reasons why federal student loans are generally preferable to private loans.

Question 42

Why should people be cautious in their use of credit cards?

Question 43

Identify at least two advantages and two disadvantages of working your way through college.

Question 44

Why is identity theft such a problem today?

Question 45

Fixed expenses are those that don't change much in a short period of time,such as car loan payments or rent.

Question 46

A budget is a record of spending over a long period of time.

Question 47

Individuals cannot find out their credit score.

Question 48

A budget deficit is the money left over for savings after expenses have been paid.

Question 49

With credit cards,the credit limit and APR are the same.

Question 50

List at least three things you should do if you suspect that your identity has been stolen.

Question 51

One purpose of budgeting is to help you save more than you spend.

Question 52

Explain how the following countries demonstrate the relationship between health and economic prosperity: Norway,France,Russia,India.

Question 53

The median income of high school graduates is only a little over half that of people who hold a bachelor's degree.

Question 54

Updating computer software can help guard against identity theft.

Question 55

Purchasing health insurance should be low on your financial priority list.