Exam 1: Understanding the Financial Planning Process

Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement. -[Money | Inflation] is the common denominator for gauging all financial transactions.

Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement. -[Vacations | Education] would be considered a necessity of life.

Financial assets are paper assets,such as savings accounts and securities.

Businesses are a key part of the circular flow of income that sustains our free enterprise system.

Most families find it difficult to discuss money matters.

The four stages of an economic cycle would not include

Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement. -[Utility | Propensity to consume] refers to the satisfaction you receive from buying certain items.

The amount of money we set aside for future consumption will be determined by

Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement. -Two key indicators of economic activity in the U.S.are production levels and [employment levels | cost of living].

GDP refers to the total earnings of American workers during a year.

Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement. -Most families find it [easy | difficult] to discuss money matters.

The financial crisis of 2008 and 2009 is best characterized as a ______________

Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement. -[Stocks | Your house] would be considered to be real property.

Financial planning is a dynamic process.

An economic contraction usually begins after a trough is reached.

Low interest rates after 2008 and 2009 reflect the Federal Reserve's desire to

Tangible assets are earning assets that are held for the returns they promise.

Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement. -As the rate of inflation increases,the purchasing power of your dollars will [increase | decrease].

About 20% of Americans say retirement planning is their most pressing financial concern.

Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement. -The two principal constraints which government places upon us are regulations and [tariffs | taxes].