Question 1

Analyzing your current financial position is a part of the first stage of the financial planning process.

Accepted Answer

A) True 
 B)False

Question 2

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 3

The uncertainty associated with decision making is referred to as:

Accepted Answer

A)  opportunity cost. 
B)  selection of alternatives. 
C)  financial goals. 
D)  personal values. 
E)  risk. 
A)  opportunity cost. 
B)  selection of alternatives. 
C)  financial goals. 
D)  personal values. 
E)  risk.

Question 4

Lenders benefit less than borrowers in times of high inflation.

Accepted Answer

A) True 
 B)False

Question 5

Time value of money refers to changes in consumer spending when inflation occurs.

Accepted Answer

A) True 
 B)False

Question 6

The financial planning process is complete once you implement your financial plan.

Accepted Answer

A) True 
 B)False

Question 7

Decreased consumer spending will usually cause:

Accepted Answer

A)  lower consumer prices. 
B)  reduced employment levels. 
C)  lower tax revenues. 
D)  lower interest rates. 
E)  higher employment levels. 
A)  lower consumer prices. 
B)  reduced employment levels. 
C)  lower tax revenues. 
D)  lower interest rates. 
E)  higher employment levels.

Question 8

A major activity in the planning component of financial planning is

Accepted Answer

A)  selecting insurance coverage. 
B)  evaluating investment alternatives. 
C)  gaining occupational training and experience. 
D)  allocating current resources for spending. 
E)  establishing a line of credit. 
A)  selecting insurance coverage. 
B)  evaluating investment alternatives. 
C)  gaining occupational training and experience. 
D)  allocating current resources for spending. 
E)  establishing a line of credit.

Question 9

Brad Opper has a goal of "saving $50 a month for vacation." Brad's goal lacks

Accepted Answer

A)  measurable terms. 
B)  a realistic perspective. 
C)  specific actions. 
D)  a tangible end. 
E)  a time frame. 
A)  measurable terms. 
B)  a realistic perspective. 
C)  specific actions. 
D)  a tangible end. 
E)  a time frame.

Question 10

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 
A)  $317 
B)  $342 
C)  $453 
D)  $512 
E)  $600

Question 11

The changing cost of money is referred to as ____________ risk.

Accepted Answer

A)  interest-rate 
B)  inflation 
C)  economic 
D)  trade-off 
E)  personal 
A)  interest-rate 
B)  inflation 
C)  economic 
D)  trade-off 
E)  personal

Question 12

People are commonly overwhelmed by the many influences on personal financial decisions. What are the factors affecting financial planning?

Accepted Answer

Personal factors that influence financia

Question 13

The present value of a future amount will decrease if _________________. 
I. the discount rate increases
II. the amount occurs closer in time
III. the compounding frequency increases
IV. inflation increases

Accepted Answer

A)  I and II only 
B)  I and III only 
C)  II and III only 
D)  III and IV only 
E)  I, III and IV only 
A)  I and II only 
B)  I and III only 
C)  II and III only 
D)  III and IV only 
E)  I, III and IV only

Question 14

A financial plan is also known and referred to as a budget.

Accepted Answer

A) True 
 B)False

Question 15

Developing financial goals is the first step in the financial planning process.

Accepted Answer

A) True 
 B)False

Question 16

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 17

The stages that an individual goes through based on age, financial needs, and family situation is called the:

Accepted Answer

A)  adult life cycle. 
B)  budgeting procedure. 
C)  personal economic cycle. 
D)  financial planning process 
E)  tax planning process. 
A)  adult life cycle. 
B)  budgeting procedure. 
C)  personal economic cycle. 
D)  financial planning process 
E)  tax planning process.

Question 18

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 19

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 20

When an individual makes a purchase without considering the financial consequences of that purchase, they are ignoring the ________________ aspect of financial planning.

Accepted Answer

A)  Borrowing 
B)  Risk Management 
C)  Spending 
D)  Retirement and Estate Planning 
E)  Obtaining 
A)  Borrowing 
B)  Risk Management 
C)  Spending 
D)  Retirement and Estate Planning 
E)  Obtaining

Analyzing your current financial position is a part of the first stage of the financial planning process.

Time value of money calculations consider:

The uncertainty associated with decision making is referred to as:

Lenders benefit less than borrowers in times of high inflation.

Time value of money refers to changes in consumer spending when inflation occurs.

The financial planning process is complete once you implement your financial plan.

Decreased consumer spending will usually cause:

A major activity in the planning component of financial planning is

Brad Opper has a goal of "saving $50 a month for vacation." Brad's goal lacks

The changing cost of money is referred to as ____________ risk.

People are commonly overwhelmed by the many influences on personal financial decisions. What are the factors affecting financial planning?

The present value of a future amount will decrease if _________________. I. the discount rate increases II. the amount occurs closer in time III. the compounding frequency increases IV. inflation increases

A financial plan is also known and referred to as a budget.

Developing financial goals is the first step in the financial planning process.

Personal financial planning has the main goal of:

The stages that an individual goes through based on age, financial needs, and family situation is called the:

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

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

When an individual makes a purchase without considering the financial consequences of that purchase, they are ignoring the ________________ aspect of financial planning.

Money Management Strategy: Financial Statements and Budgeting

Planning Your Tax Strategy

The Banking Services of Financial Institutions

Introduction to Consumer Credit

Choosing a Source 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

Analyzing your current financial position is a part of the first stage of the financial planning process.

Time value of money calculations consider:

The uncertainty associated with decision making is referred to as:

Lenders benefit less than borrowers in times of high inflation.

Time value of money refers to changes in consumer spending when inflation occurs.

The financial planning process is complete once you implement your financial plan.

Decreased consumer spending will usually cause:

A major activity in the planning component of financial planning is

Brad Opper has a goal of "saving $50 a month for vacation." Brad's goal lacks

The changing cost of money is referred to as ____________ risk.

People are commonly overwhelmed by the many influences on personal financial decisions. What are the factors affecting financial planning?

The present value of a future amount will decrease if _________________. I. the discount rate increases II. the amount occurs closer in time III. the compounding frequency increases IV. inflation increases

A financial plan is also known and referred to as a budget.

Developing financial goals is the first step in the financial planning process.

Personal financial planning has the main goal of:

The stages that an individual goes through based on age, financial needs, and family situation is called the:

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

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

When an individual makes a purchase without considering the financial consequences of that purchase, they are ignoring the ________________ aspect of financial planning.

Money Management Strategy: Financial Statements and Budgeting

Planning Your Tax Strategy

The Banking Services of Financial Institutions

Introduction to Consumer Credit

Choosing a Source 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