Budgeting/ Saving
Libby is spending 40% of her income on her wants. Libby is looking for a budget that will allocated only 30% to her wants. What budgeting rule should she follow?
50/30/20 budgeting rule
Stock
Jordan has a car loan secured by the car and misses several payments. What could happen?
They could repossess the car
Libby lives alone but is struggling with her expenses and is living paycheck to paycheck. What can libby do to cut down on expenses. (looking for the most common answer)
Get a roommate
This term is used to describe a financial loan that you lend money to a government or corporation in exchange for regular interest payments and the return of your original money in the end.
Bond
A student wants to save for some shoes in one month, a home down payment in six years, and a car in two years.
Classify each goal using these class ranges: Short term, medium term & long term
Short - Shoes
Medium - Car
Long - Home
How many months worth of money should you save in an emergency fund?
3 to 6 months
Which of the two is a greater risk? Stock or bond?
Stock
Why do we have to choose? (remember first lesson)
Scarcity (resources are limited)
What is the name of a savings account that yields high interest but has a penalty if withdrawn early?
Certificate of Deposit or CD
An early frost damages orange crops. Predict what happens to the supply of oranges and explain the direction of the supply-curve shift.
A supply curve shifts to the left when supply decreases because producers supply a smaller quantity at every given price, or because they require a higher price to supply the same quantity
This insurance type is designed for people who rent a house, apartment, or condo. It protects your personal possessions, covers you if someone is accidentally injured in your home, and pays for temporary housing if a disaster forces you to move out.
Renters insurance
Each month, Omar spends more than he brings home. What is this situation called, and what is one first step he could take?
Deficit
Lee says, “If an investment has high risk, its return is guaranteed to be high.” What is wrong with Lee’s statement?
Higher risk is generally associated with higher potential or expected return, not a guaranteed return.
Why would someone choose to get long term disability insurance even if they already have health insurance?
Health insurance only covers medical bills, while long term disability will help compensate for lost work with a percentage of their income