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MULTIPLE CHOICE REVIEW
Personal Finance
What is VISION, as it relates to financial literacy?
a. The ability to seeb. A thought in your mind of the futurec. Outline of goals leading to a desired purposed. How much money you want to have
What is VISION, as it relates to financial literacy?
c. Outline of goals leading to a desired purpose
The following factors will impact the economy, EXCEPT;
a. Gas pricesb. Layoffsc. Public Electionsd. All impact the economy
The following factors will impact the economy, EXCEPT;
d. All impact the economy
3) What is one of the risks to a high level of inflation?
a. Consumer goods are cheaperb. Buying power is decreasedc. Luxury items increase in price, while everyday goods remain the samed. Government will lose money
3) What is one of the risks to a high level of inflation?
b. Buying power is decreased
4) If Ferrari’s cost $5,000 what would happen to the quantity demanded?
a. Demand would not existb. Demand would not changec. Demand would increased. Demand would decrease
4) If Ferrari’s cost $5,000 what would happen to the quantity demanded?
c. Demand would increase
If the price to produce an iPod goes up $1,000, what would happen to quantity supplied?
a. Supply would not existb. Supply would not changec. Supply would increased. Supply would decrease
If the price to produce an iPod goes up $1,000, what would happen to quantity supplied?
d. Supply would decrease
Which of the following is NOT a deduction from a typical paycheck?
a. Medicaidb. Social Securityc. Health Insuranced. Electricity Tax
Which of the following is NOT a deduction from a typical paycheck?
d. Electricity Tax
Select the best way to describe the relationship with education & earning potential;
a. Higher levels of education achieved results in higher earning potentialb. No relationship between the two can be provedc. Working hard is better than higher levels of educationd. A Master’s degree offers the highest earning potential
Select the best way to describe the relationship with education & earning potential;
a. Higher levels of education achieved results in higher earning potential
Power in consistency; if you save a penny a day, two pennies tomorrow, four pennies the third day & for one month this
pattern continues, how much will you have at the end of a 30-day month?
a. $5,368,709.12b. $245.80c. $107,920.20d. $54,902.80
Power in consistency; if you save a penny a day, two pennies tomorrow, four pennies the third day & for one month this
pattern continues, how much will you have at the end of a 30-day month?
a. $5,368,709.12
Is saving more important than investing?
a. Depends on the price of stocksb. Both are equally important to financial healthc. Saving is more importantd. Investing is more important
Is saving more important than investing?
b. Both are equally important to financial health
Select the option that Albert Einstein refers to as “the most powerful force in the universe”
a. Gravityb. The NYSE (New York Stock Exchange)c. Compound Interestd. Educated Consumers
Select the option that Albert Einstein refers to as “the most powerful force in the universe”
c. Compound Interest
If you earn 6% interest, about how many years will it take your investment to double?
a. 20 yearsb. 16.67 yearsc. 6 yearsd. 12 years
If you earn 6% interest, about how many years will it take your investment to double?
d. 12 years
If you invest $360 (one-time) at 12% interest, what will the value of your investment be
after 70 years?
a. $1,003,607.94b. $3,024c. $28,224d. $114,908.25
If you invest $360 (one-time) at 12% interest, what will the value of your investment be
after 70 years?
a. $1,003,607.94
Select the correct formula for calculating compound interest for a one-time investment;
a. Principal * Periods * Interestb. Principal (1 + Interest)# of periodsc. (Periods/Interest) * Principald. Principal interest * Periods interest
Select the correct formula for calculating compound interest for a one-time investment;
b. Principal (1 + Interest)# of periods
Which of the following is considered a high-risk investment?
a. Stocksb. Bondsc. Money Marketsd. Hedge Funds
Which of the following is considered a high-risk investment?
d. Hedge Funds
Which retirement plan offers less risk to the employer?
a. Pension Planb. Defined-Contribution Planc. Defined-Benefit Pland. 401(k) Plan
Which retirement plan offers less risk to the employer?
b. Defined-Contribution Plan
Which company is NOT one of the three major credit-reporting agencies?
a. Transunionb. Credit-Trackc. Experiand. Equifax
Which company is NOT one of the three major credit-reporting agencies?
b. Credit-Track
How is your insurance premium calculated?
a. Complex formulas estimating your level of risk for incurring a lossb. Premiums are standard by age groupc. Depends on how much the agent makes on commissiond. None of the above
How is your insurance premium calculated?
a. Complex formulas estimating your level of risk for incurring a loss
What is a reason someone would lease a car versus purchase a car?
a. They still want ownership for less monthly payment
b. They want to protect themselves from paying for repairsc. The use of the car will be limited to certain mileage restrictionsd. Leasing a car offers tax benefits
What is a reason someone would lease a car versus purchase a car?
c. The use of the car will be limited to certain mileage restrictions
Identify why someone would purchase a home versus renting a home;
a. There is no benefit between purchasing & renting a home
b. They are afraid of continual maintenancec. Renting is better, purchasing a home cost more moneyd. They want to build equity
Identify why someone would purchase a home versus renting a home;
d. They want to build equity
Which is NOT a factor used to calculate Time Value of Money (TVM)?
a. Number of Periodsb. Interest Ratec. Future Exchange Ratesd. Principal