Question 1

Your net worth can change even if your net cash flows are zero.

Accepted Answer

A) True 
 B)False

Question 2

If you have liquid assets of $20,000 and current liabilities of $10,000,then you

Accepted Answer

A)  have a current liquidity ratio of 2. 
B)  are in poor financial shape with a liquidity ratio of 0.5. 
C)  may have trouble paying your bills depending on their due dates. 
D)  are over-extended by $10,000. 
A)  have a current liquidity ratio of 2. 
B)  are in poor financial shape with a liquidity ratio of 0.5. 
C)  may have trouble paying your bills depending on their due dates. 
D)  are over-extended by $10,000.

Question 3

If you sell stock from your portfolio to pay off your car loan,your debt ratio of 0.5 will

Accepted Answer

A)  increase. 
B)  decrease. 
C)  stay the same. 
D)  More information is needed to determine what effect this action will have. 
A)  increase. 
B)  decrease. 
C)  stay the same. 
D)  More information is needed to determine what effect this action will have.

Question 4

In the balance sheet,a(n)________ in assets ________ net worth.

Accepted Answer

A)  increase; increases 
B)  decrease; increases 
C)  Both A and D are correct. 
D)  decrease; decreases 
A)  increase; increases 
B)  decrease; increases 
C)  Both A and D are correct. 
D)  decrease; decreases

Question 5

All of the following affect cash outflows except

Accepted Answer

A)  the size of your family. 
B)  your age. 
C)  your education level. 
D)  your personal consumption behavior. 
A)  the size of your family. 
B)  your age. 
C)  your education level. 
D)  your personal consumption behavior.

Question 6

Why is it important to monitor your debt level?

Accepted Answer

A)  So it does not become so high that you cannot cover the monthly payments 
B)  So that you maintain a liquidity ratio of at least 2.5 
C)  In order to qualify for another credit card to capture the introductory points 
D)  So that your total debt does not exceed your annual income 
A)  So it does not become so high that you cannot cover the monthly payments 
B)  So that you maintain a liquidity ratio of at least 2.5 
C)  In order to qualify for another credit card to capture the introductory points 
D)  So that your total debt does not exceed your annual income

Question 7

Which of the following is not a cash inflow?

Accepted Answer

A)  Interest received 
B)  Dividend income 
C)  Car payment 
D)  Salary 
A)  Interest received 
B)  Dividend income 
C)  Car payment 
D)  Salary

Question 8

The personal cash flow statement measures

Accepted Answer

A)  the rate of cash flow. 
B)  cash outflows only. 
C)  cash inflows and outflows. 
D)  cash inflows only. 
A)  the rate of cash flow. 
B)  cash outflows only. 
C)  cash inflows and outflows. 
D)  cash inflows only.

Question 9

Some people with large incomes spend their entire paychecks within a few days,while others with small incomes may be big savers.

Accepted Answer

A) True 
 B)False

Question 10

Nancy has $40,000 of annual disposable income and saves $8,000 a year.Her savings rate is

Accepted Answer

A)  5%. 
B)  12%. 
C)  17%. 
D)  20%. 
A)  5%. 
B)  12%. 
C)  17%. 
D)  20%.

Question 11

Which of the following is not an asset you might find on a personal balance sheet?

Accepted Answer

A)  Liquid assets 
B)  Inventory 
C)  Household assets 
D)  Personal investments 
A)  Liquid assets 
B)  Inventory 
C)  Household assets 
D)  Personal investments

Question 12

Net cash flows are the difference between cash inflows and cash outflows and can be either positive or negative.

Accepted Answer

A) True 
 B)False

Question 13

For most people,the first step in finding where their money goes each month is to correctly assess their true net income.

Accepted Answer

A) True 
 B)False

Question 14

The amount you would receive if you sold an asset today is called the asset's

Accepted Answer

A)  market value. 
B)  book value. 
C)  sales value. 
D)  cost. 
A)  market value. 
B)  book value. 
C)  sales value. 
D)  cost.

Question 15

Careful budgeting and controlled spending lead to self-reliance and a feeling of financial freedom.

Accepted Answer

A) True 
 B)False

Your net worth can change even if your net cash flows are zero.

If you have liquid assets of $20,000 and current liabilities of $10,000,then you

If you sell stock from your portfolio to pay off your car loan,your debt ratio of 0.5 will

In the balance sheet,a(n) in assets net worth.

All of the following affect cash outflows except

Why is it important to monitor your debt level?

Which of the following is not a cash inflow?

The personal cash flow statement measures

Some people with large incomes spend their entire paychecks within a few days,while others with small incomes may be big savers.

Nancy has $40,000 of annual disposable income and saves $8,000 a year.Her savings rate is

Which of the following is not an asset you might find on a personal balance sheet?

Net cash flows are the difference between cash inflows and cash outflows and can be either positive or negative.

For most people,the first step in finding where their money goes each month is to correctly assess their true net income.

The amount you would receive if you sold an asset today is called the asset's

Careful budgeting and controlled spending lead to self-reliance and a feeling of financial freedom.

Overview of a Financial Plan

Applying Time Value Concepts

Using Tax Concepts for Planning

Banking and Interest Rates

Managing Your Money

Assessing and Securing Your Credit

Managing Your Credit

Personal Loans

Purchasing and Financing a Home

Auto and Homeowners Insurance

Health and Disability Insurance

Life Insurance

Investing Fundamentals

Investing in Stocks

Investing in Bonds

Investing in Mutual Funds

Asset Allocation

Retirement Planning

Estate Planning

Integrating the Components of a Financial Plan

Filters

Exam 2: Planning With Personal Financial Statements

Your net worth can change even if your net cash flows are zero.

If you have liquid assets of $20,000 and current liabilities of $10,000,then you

If you sell stock from your portfolio to pay off your car loan,your debt ratio of 0.5 will

In the balance sheet,a(n)________ in assets ________ net worth.

All of the following affect cash outflows except

Why is it important to monitor your debt level?

Which of the following is not a cash inflow?

The personal cash flow statement measures

Some people with large incomes spend their entire paychecks within a few days,while others with small incomes may be big savers.

Nancy has $40,000 of annual disposable income and saves $8,000 a year.Her savings rate is

Which of the following is not an asset you might find on a personal balance sheet?

Net cash flows are the difference between cash inflows and cash outflows and can be either positive or negative.

For most people,the first step in finding where their money goes each month is to correctly assess their true net income.

The amount you would receive if you sold an asset today is called the asset's

Careful budgeting and controlled spending lead to self-reliance and a feeling of financial freedom.

Overview of a Financial Plan

Applying Time Value Concepts

Using Tax Concepts for Planning

Banking and Interest Rates

Managing Your Money

Assessing and Securing Your Credit

Managing Your Credit

Personal Loans

Purchasing and Financing a Home

Auto and Homeowners Insurance

Health and Disability Insurance

Life Insurance

Investing Fundamentals

Investing in Stocks

Investing in Bonds

Investing in Mutual Funds

Asset Allocation

Retirement Planning

Estate Planning

Integrating the Components of a Financial Plan

Filters

In the balance sheet,a(n) in assets net worth.