Question 1

Once you have evaluated your current financial situation and know your sources of income and expenses,you have reached the point where you can establish a personal budget.

Accepted Answer

A) True 
 B)False

Question 2

Which of the following is a benefit of buying a home rather than renting?

Accepted Answer

A)  Real estate taxes and utilities will be fixed.
B)  It reduces the need to carry insurance.
C)  Paying for a home is a good way to force yourself to save.
D)  The entire purchase price of the home can be deducted from taxable income,but this deduction must be spread over at least 15 years.E) None of the above
F) B) and C)

Question 3

An) ________ can be added to a homeowner's insurance policy that provides for coverage at a reasonable cost for items that the policy otherwise would not cover.

Accepted Answer

A)  rider
B)  opener
C)  extender
D)  modifierE) B) and D)
F) None of the above

Question 4

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.E) A) and C)
F) B) and D)

Question 5

A benefit of using credit cards is that they:

Accepted Answer

A)  have lower interest rates than other forms of credit.
B)  provide a record that makes it possible to keep track of purchases easily.
C)  help consumers be more disciplined when it comes to spending decisions.
D)  allow the consumer to spread out payments and reduce overall costs.E) A) and C)
F) None of the above

Question 6

Investing in a home is generally considered a:

Accepted Answer

A)  poor choice when compared to renting.
B)  wise investment.
C)  luxury that should be postponed as long as possible.
D)  good decision,but only if you've saved enough to pay in full with cash.E) A) and B)
F) B) and C)

Question 7

Buying a _______ is often an attractive strategy for young couples,since they can live in one unit and rent the other half to supplement their income,while taking tax deductions on interest and real estate taxes.

Accepted Answer

A)  semiprivate housing unit
B)  ranch apartment
C)  biplex
D)  duplexE) A) and B)
F) A) and C)

Question 8

Monica expects to be in a much higher tax bracket when she retires than she is now,so she wants to invest in a retirement account in which her withdrawals will be tax-free.One way for her to achieve this is through a traditional IR
A.

Accepted Answer

A) True 
 B)False

Question 9

One drawback to buying a home compared to renting is that your monthly mortgage payments will increase,while rental payments are fixed.

Accepted Answer

A) True 
 B)False

Question 10

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 11

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

Accepted Answer

A) True 
 B)False

Question 12

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 availableE) None of the above
F) All of the above

Question 13

Budgets are:

Accepted Answer

A)  useful for businesses,but too restrictive to be used by individuals or households.
B)  a financial plan of projected revenues and expenses.
C)  just another name for cash flow statements.
D)  only helpful to people who earn more than $50,000 per year.E) A) and C)
F) All of the above

Question 14

What are the advantages of investing in a home?

Accepted Answer

One of the better investments persons ca...

Question 15

Before getting married,a couple should discuss and agree upon a financial strategy.

Accepted Answer

A) True 
 B)False

Question 16

The earnings on a traditional IRA are:

Accepted Answer

A)  never taxed,in order to encourage people to invest for their retirement.
B)  tax free until the Social Security system is improved.
C)  taxed as income when they are withdrawn after retirement.
D)  available to the investor without a penalty.E) None of the above
F) A) and C)

Question 17

As an employee of New Hampshire Industries,Kathleen has an opportunity to invest pre-tax income in an employer-sponsored retirement plan.Her employer will contribute 50 cents for every dollar that Kathleen contributes to this fund.This is an example of an) :

Accepted Answer

A)  individual retirement account IR
A)  plan.
B)  401k) plan.
C)  Keogh plan.
D)  restricted private investment RPI) plan.E) B) and D)
F) B) and C)

Question 18

Annette and Ron just got married.They received some very expensive wedding gifts including some beautiful silverware and jewelry.Their homeowner's policy:

Accepted Answer

A)  automatically covers these items.
B)  does not automatically cover such items and they must take out a separate policy specifically for those types of items.
C)  does not automatically cover these items,but a rider can be used to add this coverage.
D)  automatically covers these items from theft,but not from damage due to fire,explosion,or vandalism.E) A) and C)
F) All of the above

Question 19

The chances of becoming disabled at an early age are much higher than your chances of dying from an accident.

Accepted Answer

A) True 
 B)False

Question 20

A good manager of personal finances,like a good businessperson,uses borrowed funds whenever possible.

Accepted Answer

A) True 
 B)False

Exam 25: Managing Personal Finances

One drawback to buying a home compared to renting is that your monthly mortgage payments will increase,while rental payments are fixed.

Correct AnswerverifiedShow Answer

The chances of becoming disabled at an early age are much higher than your chances of dying from an accident.

Correct AnswerverifiedShow Answer

An) ________ can be added to a homeowner's insurance policy that provides for coverage at a reasonable cost for items that the policy otherwise would not cover.

Correct AnswerverifiedShow Answer

Budgets are:

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Which of the following is a benefit of buying a home rather than renting?

Correct AnswerverifiedShow Answer

What are the advantages of investing in a home?

Correct AnswerverifiedOne of the better investments persons ca...View AnswerShow Answer

Before getting married,a couple should discuss and agree upon a financial strategy.

Correct AnswerverifiedShow Answer

Monica expects to be in a much higher tax bracket when she retires than she is now,so she wants to invest in a retirement account in which her withdrawals will be tax-free.One way for her to achieve this is through a traditional IR A.

Correct AnswerverifiedShow Answer

Buying a _______ is often an attractive strategy for young couples,since they can live in one unit and rent the other half to supplement their income,while taking tax deductions on interest and real estate taxes.

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

The earnings on a traditional IRA are:

Correct AnswerverifiedShow Answer

A good manager of personal finances,like a good businessperson,uses borrowed funds whenever possible.

Correct AnswerverifiedShow Answer

Investing in a home is generally considered a:

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Once you have evaluated your current financial situation and know your sources of income and expenses,you have reached the point where you can establish a personal budget.

Correct AnswerverifiedShow Answer

As an employee of New Hampshire Industries,Kathleen has an opportunity to invest pre-tax income in an employer-sponsored retirement plan.Her employer will contribute 50 cents for every dollar that Kathleen contributes to this fund.This is an example of an) :

Correct AnswerverifiedShow Answer

A benefit of using credit cards is that they:

Correct AnswerverifiedShow Answer

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.

Correct AnswerverifiedShow Answer

Annette and Ron just got married.They received some very expensive wedding gifts including some beautiful silverware and jewelry.Their homeowner's policy:

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
One of the better investments persons ca...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified