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- 1. Multiple ChoiceThe cost of borrowing money is referred to asInterestAnnual Percentage RateCreditCredit Line
- 2. Multiple Choice
The maximum amount you are allowed to carry as a balance on the cardinterestARPcredit limitall of these - 3. Multiple ChoiceThis is a fee that some, but not all, credit card issuers charge to use their credit card.APRannual feemonthly feenon-sufficient funds fee
- 4. Multiple ChoiceThe amount you must pay on a credit card, based on a percentage of the outstanding balance.minimum feeminimum paymentmonthly statementminimum monthly interest charge
- 5. Multiple ChoiceWhich one is considered a danger of using a credit cardno cash neededleads to overspendingconvenientearns rewards
- 6. Multiple ChoiceTo build a good credit history, you shouldopen as much credit as possible quicklyuse the maximum credit allowed on all your credit cardspay on time and as much of your balance as possibleall of these
- 7. Multiple ChoiceWhat does APR stand for?American Peoples ReportsAnnual Progress ReportAmerican Percentage RateAnnual Percentage Rate
- 8. Multiple ChoiceWhat financial habits determine your credit score?Payment History & Amount you oweLength of credit history & Amount of new credit applied for recentlyTypes of credit openAll of these are correct
- 9. Multiple ChoiceWhat are the three major Credit Reporting Agencies (CRAs)?EquifaxTransUnionExperianAll of these are correct
- 10. Multiple ChoiceWhat debt cannot be removed by declaring bankruptcy?Child SupportCar LoanCredit CardMedical Bills
- 11. Multiple ChoiceWhich category makes up the largest percentage of your credit score?Type of credit usedPayment historyOutstanding debtCredit history
- 12. Multiple ChoiceThis account allows you to deposit money at a bank for safekeeping.Saving AccountChecking AccountBill AccountCasino Account
- 13. Multiple ChoiceThis account allows you to withdraw money, pay a bill, or make purchases easily.Checking AccountSavings AccountMarket Money AccountCD Account
- 14. Multiple ChoiceThis allows you to withdraw cash from your account or make payments electronically.Debit CardLoan AccountSignature CardPayday card
- 15. Multiple ChoiceThe action enters money into an account.DepositWithdrawalLoanDeduction
- 16. Multiple ChoiceWhich of these is NOT a reason to save money.RetirementFinancial emergencyMajor purchasesSo you can loan it to your friends
- 17. Multiple ChoiceIf you lose a check and want to prevent someone else from using it, you can issue this type of order to the bank.stop paymentdemand depositoutstanding checkcancelled check
- 18. Multiple ChoiceA line of credit for checks your account can't cover.overdraft protectionendorsementstop paymentcanceled check
- 19. Multiple ChoiceMoney taken out of your checking account.withdrawalstop paymentendorsementoutstanding
- 20. Multiple ChoiceWhat does it mean to reconcile your checkbook?this happens when you fill out your check register.At the end of the month you check to see if your check register matches your bank statement.This happens when you go to the bank and deposit moneyThis happens each time you write a check.
- 21. Multiple ChoiceAn asset that can be easily converted to cash is ___________________.a withdrawalliquidwateran ATM.
- 22. Multiple ChoiceA man budgeted $200 a month for clothing. This month the man spent $150 on clothing therefore that budget item is considered to haveA. an outflow deficit.B. an income overage.
C. a budget variance.D. a budget deficit. - 23. Multiple ChoiceA person's debt ratio shows the relationship between debt and net worth. The lower the ratio theA. better off financially the person is.B. worse off financially the person is.C. more liquid assets the person has.D. less liquid assets the person has.
- 24. Multiple ChoiceIn creating her budget, Ann realizes that her expenses exceed her income. Ann should immediately try to:A. apply for a loanB. reduce or eliminate some expensesC. ignore her budget until she has more incomeD. open an IRA account
- 25. Multiple ChoiceAn example of a fixed expense is:A. EntertainmentB. Apartment rentC. RestaurantsD. Vacations
- 26. Multiple ChoiceA stock broker or financial consultant:A. Gives financial advice to clientsB. Sells money orders and certified checksC. Guarantee a return on investmentD. Do not have to be licensed
- 27. Multiple ChoiceLamar believes that interest rates are going to fall in the near future and remain low for a considerable period of time. She should invest in:A. Nothing, she should put her money under her mattressB. A variable rate certificate of depositC. A long-term, fixed rate certificate of depositD. A short-term, fixed rate certificate of deposit
- 28. Multiple ChoiceMoney received today is worth more than the same amount of money received sometime in the future is:A. The Rule of 72B. The time value of moneyC. Not trueD. Investing
- 29. Multiple ChoiceInterest earned on interest is known as:A. Simple interestB. True interestC. Compounded interestD. Variable interest
- 30. Multiple Choice
Use the Rule of 72 to calculate how long it will take for your money to double if it's earning 6% in interest
12yrs
16yrs
36yrs
72yrs
- 31. Multiple Choice
Asim's Monthly Expenses Budget
School Supplies $75
Food $100
Entertainment $25
Transportation $50
Savings $25
Total $275
Use the information above to answer the following question:
Asim earns $250 per month. Which statement below is most correct?
Asim makes more than she spends
Asim spends more than she makes
Asim should save more in the future
Asim should stop saving in the future
- 32. Multiple Choice
(Check all that apply) Which of the following are examples of types of savings vehicles?
Certificate of Deposit
Money Market Account
Checking Account
Savings Account
- 33. Multiple Choice
Which type of bank account typically offers no interest?
Savings
Money market
Certificate of Deposit
Checking
- 34. Multiple Choice
Which of the following typically have the highest fees?
Retail Bank
Credit Union
Online Bank
Payday Lender
- 35. Multiple Choice
Use the Credit Card Disclosure to answer the following: What is the customary APR on purchases after the initial 12 months?
36.5%
27.357%
18.35%
5.65%
- 36. Multiple Choice
The term referring to the rate of yearly interest for your credit card is commonly known as
Default rate
APR
COD
Grace Period
- 37. Multiple Choice
The form filed by students to receive federal financial aid for school is known as:
FASFA
FIFA
FICO
FAA
- 38. Multiple Choice
The period before you have to begin repaying your student loans is known as the:
default period
zero interest period
grace period
promotional period
- 39. Multiple Choice
Which of the following statements is most correct?
A benefit of owning a home is that it is easier to move
A benefit of renting a home is that you can make renovations to the home
A benefit of owning a home is that the value may appreciate
A benefit of renting a home is that you can move out whenever you want
- 40. Multiple Choice
What are the responsibilities of a renter versus an owner?
A renter living in a house has complete responsibility and control over the property
An owner of a house has complete responsibility and control over the property
Neither a renter nor an owner has any responsibility and control over the property-its completely controlled by the government
Both a renter and the owner have equal responsibility and control over the property
- 41. Multiple Choice
(Check all that apply) Which of the following should you take into consideration when deciding to buy or lease a car?
Cost of the car
Monthly loan payment
Your monthly budget
Down payment
Your current savings
- 42. Multiple ChoiceCentral Bank of the U.S.; regulates Monetary PolicyUS TreasuryFederal ReserveIRSUS Mint
- 43. Multiple ChoiceInsurance coverage that would cover claims unrelated to an accident (you hit a deer, bad weather damages your car, your car is stolen, etc)liabilitycomprehensivecollisionuninsured motorist
- 44. Multiple ChoiceA type of insurance policy that covers property that is easily movable and provides additional coverage over what normal insurance policies do not. This can cover anything from jewelry to expensive stereo equipmentfloater insuranceumbrella insuranceliability insurancenone of these
- 45. Multiple ChoiceUsing someone else's money, promising to repay at a future date, and paying a fee for use of the money, is the definition for:DividendCredit
- 46. Multiple ChoiceWhen a self-employed person decides to purchase disability insurance it is generally to protect against the financial effects of not being able to work.financial effects of not being able to work.possibility of customers defaulting on their loans.
- 47. Multiple Choice________ is a tax used to fund the Social Security systemIncome TaxFICA Tax
- 48. Multiple ChoicePat has a savings account and a car loan from a not-for-profit financial institution owned by its members. She is probably a member of what type of financial institution?Commercial BankCredit Union
- 49. Multiple ChoiceThe ________ is designed to make sure you have all of the information you need to make a healthy decision about borrowing money.Predatory LendingTruth In Lending Act
- 50. Multiple ChoiceTroy has $50 a month transferred electronically from his checking account to his savings account. This is an example of:Savings planThrift plan
- 51. Multiple Choice
What form do you complete upon being hired
W-2
W-4
1099
1098
- 52. Multiple Choice
Property Tax is tax paid on?
Goods and Services
Earned Income
Building, Land, Vehicles
Airline Tickets
- 53. Multiple Choice
The form given to you from your employer to help you fill out your taxes?
1099
1098
W-2
W-4
- 54. Multiple Choice
The tax form that for those that make less than $100,000 and claim no deductions.
1040
1040A
1040EZ
1030
- 55. Multiple Choice
Employment Eligibility Verification Form required by the Immigration and Naturalization Services (INS) to verify your identity and your eligibility to work; filled out before you begin working
I10
I9
w2
w4
- 56. Multiple ChoiceWhat are the two types of depository institutions?Credit Unions and BanksSavings and CheckingWallets and PursesLoans and Credit
- 57. Multiple ChoiceWhy is it important to create a budget?You earn more moneyYou get things you want before you get things you needHelps you plan how you are going to spend your moneyThey're pointless
- 58. Multiple Choice
Credit scores can range from:
100-1000
1-10
200-900
300-850
- 59. Multiple Choice
Amount of money originally borrowed
Mortgage
Principal
Annual percentage rate (APR)
Finance company
- 60. Multiple Choice
This type of interest "creates a mathematical explosion," and it can make you wealthy over time, or keep you in debt for a long time.
compound
sinking
annual
- 61. Multiple Choice
401(k), IRA, and Roth IRA are all examples of a __________ account.
Retirement
College Savings
Low Interest
Stock
- 62. Multiple Choice
Because mutual funds spread your investment around in multiple stocks and bonds, they are a great example of this term
diversification
overdraft
debt
beneficiary
- 63. Multiple Choice
The basic concept of credit is:
Savings
Pay now, buy later
Something only people without high paying jobs need
Buy now, pay later
- 64. Multiple Choice
Which financial product can you buy for $25, is safe, and will be worth $50 at a future date?
Series EE savings bond
Certificate of deposit
50 shares of ABC Co. stock
ABC Co. bond
- 65. Multiple Choice
Example of a secured loan
car loan
loan based on credit worthiness
- 66. Multiple Choice
Example of unsecured loan
house mortgage
credit card
- 67. Multiple ChoiceA person has three credit cards with very large outstanding balances and is unable to make payments on any of them. Which action should the person take?A Notify a credit reporting agency in order to avoid a late fee.File for bankruptcy in order to maintain ones current credit scoreNotify the credit card companies in order to negotiate a new payment plan.Contact the Internal Revenue Service in order to avoid paying income tax this year.
- 68. Multiple ChoiceA person buys a flat screen, plasma, theater-like television. The person has homeowner's insurance. Why would it be appropriate to add a personal property floater to that insurance?To reduce the premium on the homeowner's insurance.To protect the person who owns the television from liability for damages.To show the insurance company a good faith investment has been made.To cover the cost of replacement should the television get damaged or stolen.
- 69. Multiple ChoiceA woman has just received a very expensive piece of jewelry. The woman has homeowner's insurance. Which statement would it be most appropriate for her to make to her insurance agent?"I think I need a personal property floater.""I need a liability claim""I need a high deductible""I need to determine my net worth"
- 70. Multiple ChoiceSally's health insurance policy requires her to pay the first $500 of medical costs each year before the company will pay any of her medical bills. This policy provision is the:Co-insurance clausePremiumAnnual deductibleMajor medical benefit
- 71. Multiple ChoiceGwen receives a bill from her auto insurance company, and she sends a check to the company to make sure her policy is not cancelled. The cost of her policy is called the:Co-insurance clausePremiumDeductibleExclusion
- 72. Multiple ChoiceGenerally, the higher the deductible on an insurance policy, thegreater the premium.lower the premium.more frequently the premium has to be paid.less frequently the premium has to be paid.
- 73. Multiple ChoiceSally took out a $50,000 life insurance policy. The $50,000 amount of coverage is called the:Cash valuePremium valueDeath benefit or face valueAnnuity value
- 74. Multiple ChoiceThe purpose of Insurance is NOT to:Diversify an investment portfolioShare risk with other policy holders and the insurance companyProtect assetsProtect against potential losses
- 75. Multiple ChoiceRichard's auto insurance policy expired on 5/15/2002. Richard was upset with his insurance agent and decided to change insurance companies. At 10:00 a.m. on 5/16/2002, as he drove to a different agent to buy a new policy, he had an accident. Who is liable for damage to his car and his personal injuries?The old agentThe new agentRichardThe old agent is liable for damage to your car and the new agent for personal injuries
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