Question 1

Risks associated with most financial decisions are fairly easy to measure.

Accepted Answer

A) True 
 B)False

Question 2

Which type of computation would a person use to determine current value of a desired amount for the future?

Accepted Answer

A) simple interest 
B) future value of a single amount 
C) future value of a series of deposits 
D) present value of a single amount 
E) present value of a series of deposits 
A) simple interest 
B) future value of a single amount 
C) future value of a series of deposits 
D) present value of a single amount 
E) present value of a series of deposits

Question 3

The third step of the financial planning process is to

Accepted Answer

A) develop financial goals. 
B) implement the financial plan. 
C) Identify alternatives. 
D) evaluate and revise your actions. 
E) create a financial plan of action. 
A) develop financial goals. 
B) implement the financial plan. 
C) Identify alternatives. 
D) evaluate and revise your actions. 
E) create a financial plan of action.

Question 4

Your life situation is affected by which of the following?

Accepted Answer

A) Buying a car 
B) Vacations 
C) Getting a raise at work 
D) Divorce 
E) Grades 
A) Buying a car 
B) Vacations 
C) Getting a raise at work 
D) Divorce 
E) Grades

Question 5

If a person deposited $100 a month for 5 years earning 9 percent, this would involve what type of computation?

Accepted Answer

A) simple interest 
B) future value of a single amount 
C) future value of a series of deposits 
D) present value of a single amount 
E) present value of a series of deposits 
A) simple interest 
B) future value of a single amount 
C) future value of a series of deposits 
D) present value of a single amount 
E) present value of a series of deposits

Question 6

Personal financial planning has the main goal of:

Accepted Answer

A) Savings and investing for future needs. 
B) Reducing a person's tax liability. 
C) Managing money to achieve personal economic satisfaction. 
D) Spending to achieve financial objectives. 
E) Savings, spending, and borrowing based on current needs. 
A) Savings and investing for future needs. 
B) Reducing a person's tax liability. 
C) Managing money to achieve personal economic satisfaction. 
D) Spending to achieve financial objectives. 
E) Savings, spending, and borrowing based on current needs.

Question 7

Time value of money calculations consider:

Accepted Answer

A) present value. 
B) interest rate. 
C) payment 
D) time period. 
E) all of the above. 
A) present value. 
B) interest rate. 
C) payment 
D) time period. 
E) all of the above.

Question 8

Assume your uncle will pay you $100 for each of the next two years and $200 in years 3 and these amounts will be paid at year end.Assume the interest rate is 10% for the first two years and 12% for the next two (years 3 and 4).What is your uncle's promise worth in today's dollars? (Round your answer)

Accepted Answer

A) $317 
B) $342 
C) $453 
D) $512 
E) $600 100 (PVAnnuity2,10%) + 200 (PVAnnuity2,12%)((PV2,10%)
100 (1.7355) + 200 (1.6901)(.8264) 
A) $317 
B) $342 
C) $453 
D) $512 
E) $600 100 (PVAnnuity2,10%) + 200 (PVAnnuity2,12%)((PV2,10%)
100 (1.7355) + 200 (1.6901)(.8264)

Question 9

Your life situation is affected by which of the following?

Accepted Answer

A) Buying a car 
B) Vacations 
C) Getting a raise at work 
D) Changes in health 
E) Grades 
A) Buying a car 
B) Vacations 
C) Getting a raise at work 
D) Changes in health 
E) Grades

Question 10

The fourth step of the financial planning process is to

Accepted Answer

A) develop financial goals. 
B) implement the financial plan. 
C) determine your current personal and financial situation. 
D) evaluate and revise your actions. 
E) Evaluate alternatives - consider economic and life factors. 
A) develop financial goals. 
B) implement the financial plan. 
C) determine your current personal and financial situation. 
D) evaluate and revise your actions. 
E) Evaluate alternatives - consider economic and life factors.

Question 11

____________ goals relate to personal relationships, health, and education.

Accepted Answer

A) Short-term 
B) Intangible-purchase 
C) Consumable-product 
D) Durable-product 
E) Intermediate 
A) Short-term 
B) Intangible-purchase 
C) Consumable-product 
D) Durable-product 
E) Intermediate

Question 12

Your goal is to accumulate in 4 years $5,000.If you can earn a rate of 4%, compounded monthly, what will be your end of month monthly payment need to be to reach this goal?

Accepted Answer

A) $96 
B) $104 
C) $124 
D) $262 
E) $300 
A) $96 
B) $104 
C) $124 
D) $262 
E) $300

Question 13

Which of the following is usually considered a long-term financial strategy?

Accepted Answer

A) creating a budget 
B) using savings to pay off a loan early 
C) renting an apartment to save for the purchase of a home 
D) investing in a growth mutual fund to accumulate retirement funds 
E) purchasing life insurance to cover current needs of dependents 
A) creating a budget 
B) using savings to pay off a loan early 
C) renting an apartment to save for the purchase of a home 
D) investing in a growth mutual fund to accumulate retirement funds 
E) purchasing life insurance to cover current needs of dependents

Question 14

Changes in income, values, and family situation make it necessary to:

Accepted Answer

A) develop financial goals 
B) implement the financial plan. 
C) evaluate and revise your actions. 
D) analyze your current personal and financial situation. 
E) create a financial plan of action. 
A) develop financial goals 
B) implement the financial plan. 
C) evaluate and revise your actions. 
D) analyze your current personal and financial situation. 
E) create a financial plan of action.

Question 15

Present value is also referred to as compounding.

Accepted Answer

A) True 
 B)False

Question 16

Economic Factor: Unemployment rate measures?

Accepted Answer

A) The total value of goods and services produced within a country's borders, including items produced with foreign resources 
B) The demand for goods and services by individuals and households 
C) The cost of money; the cost of credit when you borrow; the return on your money when you save or invest 
D) The dollars available for spending in our economy 
E) The number of people without employment who are willing and able to work 
A) The total value of goods and services produced within a country's borders, including items produced with foreign resources 
B) The demand for goods and services by individuals and households 
C) The cost of money; the cost of credit when you borrow; the return on your money when you save or invest 
D) The dollars available for spending in our economy 
E) The number of people without employment who are willing and able to work

Question 17

An example of a durable good is:

Accepted Answer

A) Stove 
B) Therapy 
C) Food 
D) Books 
E) Bank Account 
A) Stove 
B) Therapy 
C) Food 
D) Books 
E) Bank Account

Question 18

Higher prices are likely to result from:

Accepted Answer

A) increased spending by consumers. 
B) increased production by business. 
C) lower interest rates. 
D) lower demand by consumers 
E) an increase in the supply of a product. 
A) increased spending by consumers. 
B) increased production by business. 
C) lower interest rates. 
D) lower demand by consumers 
E) an increase in the supply of a product.

Question 19

Assume your friend will pay you $200 for each of the next two years and $400 in years 3 and these amounts will be paid at year end.Assume the interest rate is 10% for the first two years and 12% for the next two (years 3 and 4).What is your friend's promise worth in today's dollars? (Round your answer)

Accepted Answer

A) $1,000 
B) $951 
C) $906 
D) $831 
E) $600 
A) $1,000 
B) $951 
C) $906 
D) $831 
E) $600

Question 20

Assume the following future values will be received at the end of each year.What is the interest rate if the future value of these amounts at the end of year 3 is equal to $2,006?
 Yr.1 = $400; Yr.2 = $500; Yr.3 = $1,000

Accepted Answer

A) 6.5% 
B) 6.8% 
C) 7.0% 
D) 8.0% 
E) 8.9% 
A) 6.5% 
B) 6.8% 
C) 7.0% 
D) 8.0% 
E) 8.9%

Risks associated with most financial decisions are fairly easy to measure.

Which type of computation would a person use to determine current value of a desired amount for the future?

The third step of the financial planning process is to

Your life situation is affected by which of the following?

If a person deposited $100 a month for 5 years earning 9 percent, this would involve what type of computation?

Personal financial planning has the main goal of:

Time value of money calculations consider:

Your life situation is affected by which of the following?

The fourth step of the financial planning process is to

____________ goals relate to personal relationships, health, and education.

Your goal is to accumulate in 4 years $5,000.If you can earn a rate of 4%, compounded monthly, what will be your end of month monthly payment need to be to reach this goal?

Which of the following is usually considered a long-term financial strategy?

Changes in income, values, and family situation make it necessary to:

Present value is also referred to as compounding.

Economic Factor: Unemployment rate measures?

An example of a durable good is:

Higher prices are likely to result from:

Assume the following future values will be received at the end of each year.What is the interest rate if the future value of these amounts at the end of year 3 is equal to $2,006? Yr.1 = $400; Yr.2 = $500; Yr.3 = $1,000

Money Management Strategy: Financial Statements and Budgeting

Planning Your Tax Strategy

Banking Services of Financial Institutions

Introduction to Consumer Credit

Choosing a Source of Credit: The Costs of Credit Alternatives

The Finances of Housing

Home and Automobile Insurance

Life, Health, and Disability Insurance

Fundamentals of Investing

Investing in Stocks

Investing in Bonds

Investing in Mutual Funds

Retirement Planning

Estate Planning

Filters

Exam 1: Personal Financial Planning: An Introduction

Risks associated with most financial decisions are fairly easy to measure.

Which type of computation would a person use to determine current value of a desired amount for the future?

The third step of the financial planning process is to

Your life situation is affected by which of the following?

If a person deposited $100 a month for 5 years earning 9 percent, this would involve what type of computation?

Personal financial planning has the main goal of:

Time value of money calculations consider:

Your life situation is affected by which of the following?

The fourth step of the financial planning process is to

____________ goals relate to personal relationships, health, and education.

Your goal is to accumulate in 4 years $5,000.If you can earn a rate of 4%, compounded monthly, what will be your end of month monthly payment need to be to reach this goal?

Which of the following is usually considered a long-term financial strategy?

Changes in income, values, and family situation make it necessary to:

Present value is also referred to as compounding.

Economic Factor: Unemployment rate measures?

An example of a durable good is:

Higher prices are likely to result from:

Assume the following future values will be received at the end of each year.What is the interest rate if the future value of these amounts at the end of year 3 is equal to $2,006? Yr.1 = $400; Yr.2 = $500; Yr.3 = $1,000

Money Management Strategy: Financial Statements and Budgeting

Planning Your Tax Strategy

Banking Services of Financial Institutions

Introduction to Consumer Credit

Choosing a Source of Credit: The Costs of Credit Alternatives

The Finances of Housing

Home and Automobile Insurance

Life, Health, and Disability Insurance

Fundamentals of Investing

Investing in Stocks

Investing in Bonds

Investing in Mutual Funds

Retirement Planning

Estate Planning

Filters