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Exam 24: Managing Personal Finances

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Question 121

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Throughout history an investment in ________ has yielded an excellent return, regardless of the state of the economy or political changes.

A) antiques
B) a good education
C) government bonds
D) savings accounts

E) B) and D)
F) A) and B)

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Question 122

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If possible, it is almost always better to buy a single home rather than an attached home.

A) True
B) False

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Question 123

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Casey wants to obtain life insurance at the lowest possible cost, but is leery of term insurance because she has heard the premiums tend to go up every few years. One way for her to avoid this concern would be to purchase multiyear level-premium insurance.

The younger you are when you buy term life insurance, the lower the premiums tend to be.

Shulei graduated from college two years ago. She has already accumulated enough money in her savings account and money market to meet her basic needs, and now wants to begin investing a portion of each paycheck to earn a high rate of return over the long run. Shulei's best choice as a young woman would be to put money into a bank savings account regularly.

Although he has a good health insurance policy, Shaun is concerned that a serious accident or lengthy illness would still be devastating to his family because of the lost income and other expenses not covered by his policy. Shaun would probably be interested in obtaining

You should never borrow to cover regular expenses, but it makes perfectly good sense to use credit to cover unexpected expenses such as car or home repairs.

Alvin's credit card charges him 18% interest on his unpaid balance. His bank is offering him 1% interest on a savings account. The first thing Alvin should do with any extra money he may have is to

Due to the high cost of the insurance premiums, many people have found that it makes financial sense to carry medical insurance only if their employer provides it.

During a recent drop in the stock market, Damon took the opportunity to buy a wide variety of stocks even though many of his friends and relatives were selling. His investment strategy appears to be consistent with contrarian views.

If you are in the 25 percent tax bracket and your home mortgage interest is $1,000 per month, then your after-tax mortgage interest cost is $750 per month.

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

What advice might a personal financial advisor offer a recent college graduate desiring to become financially secure?

Borrowing money for ordinary expenses is a necessary part of life.

Brad and Tori are experiencing marriage difficulties regarding money. One technique to help them control and forecast their future financial situation, as well as allow them to achieve their financial goals, would be to prepare a(n)

Which of the following deductible levels would result in the lowest premium for automobile insurance?

The U.S. government provides several types of financial incentives to encourage people to attend college.

One problem with the Social Security system is that the number of people retiring and living longer is declining dramatically.

Many employers offer health insurance coverage for their full-time employees.

The earnings of a traditional individual retirement account (IRA) are