Random 1
Short term goals may involve:
Planning a vacation
Saving for college
retirement planning
All of the above
Planning a vacation
A person who borrows money is called an _____.
Creditor
Lender
borrower
cosigner
borrower
Experts recommend setting aside ___ pay in an emergency fund.
3-6 Months
1-2 Years
2-3 Years
3 or more years
3-6 Months
____ is a strategy to earn more money than the rate of inflation.
Liquidity
Refinancing
Consolidation
Investing
Investing
Current credit card legislation is designed to ______.
protect credit card company
protect the consumer
protect the government
None of the above
protect the consumer
If expenses were to exceed income on a budget (spending plan), what would be a financially smart solution?
Decrease expenses
Use a credit card more often
Earn less income
Increase spending
Decrease expenses
Which of the following is true of a credit card with a fixed interest rate?
The rate cannot be changed.
The rate can be changed with 60s days notice.
A rate change can be applied to existing balances.
None of the above
The rate cannot be changed.
When you own stock in a company that is assessed millions in fines for violating federal safety standards in its products, this is a case of:
inflation risk
industry risk
stock risk
company risk
stock risk
When a rental agreement contains a purchase option at the end of the rental term, the renter is said to have:
refusal of first right
a balloon option
the right of first refusal
a deferred- payment plan
the right of first refusal
The main objective of personal financial planning is to
Plan for retirement
control your spending habits
reach personal and financial goals
increase the amount in your savings
reach personal and financial goals
When a company's overseas factory is destroyed during protests and rioting, this is an example of:
Inflation Risk
Industry Risk
Political Risk
Company Risk
Political Risk
Which of the following is a risk-free investment?
Stocks
Corporate Bonds
Money Market Accounts
Real estate
Money Market Accounts
Which of the following is true of an FHA mortgage loan?
It allows for a smaller downpayment
It requires you to pay a monthly mortgage insurance premium
It is backed by the Federal Housing Admin.
All of the above
All of the above
An investment portfolio should:
concentrate of a single investment
exclude any high risk investments
have a strong foundation of safe investments
none of the above
have a strong foundation of safe investments
The higher the rating on an investment grade bond ____.
the higher the interest rate you will earn
the lower the interest rate you will earn
the more speculative it is
none of these
the lower the interest rate you will earn
Which of the following is a justifiable reason for not refunding a tenants security deposit?
Normal wear and tear of premise
excessive noise
holes in the walls
None of the above
holes in the walls
A portion of a corporations profits distributed to stockholders is called:
interest payments
gain on principal
return on investment
dividend
dividend
All of the following are advantages of using credit except:
Leverage
Convenience
Security
Decreased purchasing power
Decreased purchasing power
Out of pocket costs to the insured when a loss occurs?
Premium
Deductible
claim
policy
Deductible
Which of the following is NOT considered part of an estate but can reduce the amount of the estate?
A persons belongings and collectibles
Physical and intangible assets
debt
debt
The purpose of a cash flow statement is to
Budget for future spending
summarize assets and liabilities
project the future value of investments
list your cash inflows and outflows for a period of time
list your cash inflows and outflows for a period of time
Buying insurance is an example of which risk strategy?
Risk reduction
risk avoidance
risk transfer
risk assumption
risk transfer
The emphasis of savings is on
growth over time
safety principal
risky investments
the accumulation of wealth
the accumulation of wealth
The legal process that allows a lender to take possession of a house because the borrower does not meet his or her mortgage obligations:
Garnishment
Foreclosure
Bankruptcy
Discharge
Foreclosure
What is a budget?
A personal financial statement that list cash inflows and cash outflows.
A personal financial statement that lists assets, liabilities, and net worth.
Financial planning tool used to track individuals values, needs, wants, and goals.
A spending and savings plan on your expected income and expenses for a period of time.
A spending and savings plan on your expected income and expenses for a period of time.