Question 1

Your computer and car should both be listed on the asset side of your personal balance sheet.

Accepted Answer

A) True 
 B)False

Question 2

Bob's credit card charges him 14% interest on his unpaid balance.His bank is offering him 5% interest on a savings account.The first thing Bob should do with any extra money he may have is to:

Accepted Answer

A)  invest in the stock market.
B)  open a savings account.
C)  pre-pay for necessities,like rent and utilities.
D)  pay off the credit card balance.E) B) and C)
F) None of the above

Question 3

The biggest advantage of the Roth IRA is that:

Accepted Answer

A)  income contributed to the retirement plan is tax-free.
B)  withdrawals from the retirement plan are tax-free.
C)  taxes on the income contributed to the retirement plan are deferred until the funds are withdrawn.
D)  withdrawals from the retirement plan are tax-deferred until the individual reaches 59½ years of age.E) A) and B)
F) C) and D)

Question 4

Purchasing ________ insurance is a relatively low cost way of protecting yourself from lost income due to an accident or prolonged illness.

Accepted Answer

A)  flexible term
B)  health
C)  contingent annuity
D)  disabilityE) B) and D)
F) C) and D)

Question 5

Excessive debt is as much a problem of young consumers as it is of other age groups.

Accepted Answer

A) True 
 B)False

Question 6

Given a 25% tax bracket,the after-tax cost of a house mortgage interest payment of $1,000 would be:

Accepted Answer

A)  $ 250.
B)  $ 750.
C)  $1,000.
D)  $1,250.E) None of the above
F) A) and D)

Question 7

Which of the following is true of credit cards?

Accepted Answer

A)  They are a cheaper way to finance your education.
B)  They are an efficient way to keep track of purchases.
C)  They are an effective way of controlling the amount of debt the consumer incurs.
D)  They are less convenient than carrying cash or writing a check.E) C) and D)
F) A) and B)

Question 8

One of the first things the financial planner was likely to have them do would be to:

Accepted Answer

A)  open an individual retirement account IR
A)  .
B)  borrow money to pay for their excess expenses.
C)  take inventory of their financial position.
D)  return to school and pursue a graduate degree.E) A) and B)
F) A) and C)

Question 9

When young people decide to buy a house,the best approach is to buy a house in an inexpensive part of town so they can get a larger house for less money.

Accepted Answer

A) True 
 B)False

Question 10

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.E) C) and D)
F) None of the above

Question 11

Employees of small businesses can contribute to a Keogh plan.

Accepted Answer

A) True 
 B)False

Question 12

Identify and discuss the six steps that individuals can take to gain control of their personal finances.

Accepted Answer

Step 1.Take inventory of your financial ...

Question 13

In order to qualify as a tax shelter,IRA saving plans must be invested in mutual funds.

Accepted Answer

A) True 
 B)False

Question 14

Recent demographic trends suggest that the financial condition of the Social Security program soon will begin to improve.

Accepted Answer

A) True 
 B)False

Question 15

The person who is named in your will to assemble the assets in your estate,handle taxes,and distribute the assets is called your proxy.

Accepted Answer

A) True 
 B)False

Question 16

About _______ of all U.S.households own stock in corporations.

Accepted Answer

A)  16 percent
B)  30 percent
C)  half
D)  three-fourthsE) None of the above
F) A) and C)

Question 17

Slobo is an immigrant to the United States from a formerly communist country.He is searching for advice to help him succeed in a capitalist system.He would be well advised to:

Accepted Answer

A)  find a job and live frugally in order to save money to invest.
B)  rely heavily on government assistance programs to maintain a relatively comfortable life style.
C)  get a credit card,even if it has a very low credit limit,and use it to establish a good credit rating.
D)  follow the buy now,pay later rule of personal finance.E) B) and C)
F) B) and D)

Question 18

The factor likely to have the greatest impact on how fast the value of a home appreciates over time is the:

Accepted Answer

A)  interest rate on the mortgage.
B)  style and design features built into the home.
C)  location of the home.
D)  size of the home.E) B) and C)
F) A) and D)

Question 19

Preparing and living with a personal budget is:

Accepted Answer

A)  not necessary if your have sufficient income.
B)  similar to activities needed to handle the finances of a small business.
C)  often more trouble than the benefits justify.
D)  an excellent technique to prepare for a career in accounting.E) A) and B)
F) All of the above

Question 20

Ima Safer,who recently graduated from college and got a full time job,has prepared her first personal budget and found a pleasant surprise.After taking into account her expected monthly income and all of her ordinary expenses,including the monthly payment on her credit card,she should have some money left over.If Ima is like most young people who are just starting out,the best thing for her to do with the extra money would be to:

Accepted Answer

A)  use it to open her own business.
B)  pay off any charges against her credit card account or other high interest debts.
C)  use it to make a down payment on a house.
D)  put it into a savings account that earns a guaranteed rate of return.E) A) and B)
F) C) and D)

Exam 25: Managing Personal Finances

When young people decide to buy a house,the best approach is to buy a house in an inexpensive part of town so they can get a larger house for less money.

Correct Answer
verified

Given a 25% tax bracket,the after-tax cost of a house mortgage interest payment of $1,000 would be:

Correct Answer
verified

Bob's credit card charges him 14% interest on his unpaid balance.His bank is offering him 5% interest on a savings account.The first thing Bob should do with any extra money he may have is to:

Correct Answer
verified

Purchasing ________ insurance is a relatively low cost way of protecting yourself from lost income due to an accident or prolonged illness.

Correct Answer
verified

The biggest advantage of the Roth IRA is that:

Correct Answer
verified

About _______ of all U.S.households own stock in corporations.

Correct Answer
verified

One of the first things the financial planner was likely to have them do would be to:

Correct Answer
verified

Which of the following is true of credit cards?

Correct Answer
verified

Correct Answer
verified

Excessive debt is as much a problem of young consumers as it is of other age groups.

Correct Answer
verified

Recent demographic trends suggest that the financial condition of the Social Security program soon will begin to improve.

Correct Answer
verified

Slobo is an immigrant to the United States from a formerly communist country.He is searching for advice to help him succeed in a capitalist system.He would be well advised to:

Correct Answer
verified

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

Correct Answer
verified

Employees of small businesses can contribute to a Keogh plan.

Correct Answer
verified

The factor likely to have the greatest impact on how fast the value of a home appreciates over time is the:

Correct Answer
verified

Preparing and living with a personal budget is:

Correct Answer
verified

Identify and discuss the six steps that individuals can take to gain control of their personal finances.

Correct Answer
verified
Step 1.Take inventory of your financial ...
View Answer

In order to qualify as a tax shelter,IRA saving plans must be invested in mutual funds.

Correct Answer
verified

Your computer and car should both be listed on the asset side of your personal balance sheet.

Correct Answer
verified

The person who is named in your will to assemble the assets in your estate,handle taxes,and distribute the assets is called your proxy.

Correct Answer
verified

Exam 25: Managing Personal Finances

When young people decide to buy a house,the best approach is to buy a house in an inexpensive part of town so they can get a larger house for less money.

Correct AnswerverifiedShow Answer

Given a 25% tax bracket,the after-tax cost of a house mortgage interest payment of $1,000 would be:

Correct AnswerverifiedShow Answer

Bob's credit card charges him 14% interest on his unpaid balance.His bank is offering him 5% interest on a savings account.The first thing Bob should do with any extra money he may have is to:

Correct AnswerverifiedShow Answer

Purchasing ________ insurance is a relatively low cost way of protecting yourself from lost income due to an accident or prolonged illness.

Correct AnswerverifiedShow Answer

The biggest advantage of the Roth IRA is that:

Correct AnswerverifiedShow Answer

About _______ of all U.S.households own stock in corporations.

Correct AnswerverifiedShow Answer

One of the first things the financial planner was likely to have them do would be to:

Correct AnswerverifiedShow Answer

Which of the following is true of credit cards?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Excessive debt is as much a problem of young consumers as it is of other age groups.

Correct AnswerverifiedShow Answer

Recent demographic trends suggest that the financial condition of the Social Security program soon will begin to improve.

Correct AnswerverifiedShow Answer

Slobo is an immigrant to the United States from a formerly communist country.He is searching for advice to help him succeed in a capitalist system.He would be well advised to:

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Employees of small businesses can contribute to a Keogh plan.

Correct AnswerverifiedShow Answer

The factor likely to have the greatest impact on how fast the value of a home appreciates over time is the:

Correct AnswerverifiedShow Answer

Preparing and living with a personal budget is:

Correct AnswerverifiedShow Answer

Identify and discuss the six steps that individuals can take to gain control of their personal finances.

Correct AnswerverifiedStep 1.Take inventory of your financial ...View AnswerShow Answer

In order to qualify as a tax shelter,IRA saving plans must be invested in mutual funds.

Correct AnswerverifiedShow Answer

Your computer and car should both be listed on the asset side of your personal balance sheet.

Correct AnswerverifiedShow Answer

The person who is named in your will to assemble the assets in your estate,handle taxes,and distribute the assets is called your proxy.

Correct AnswerverifiedShow 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
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Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
Step 1.Take inventory of your financial ...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified