Question 1

When a person owns corporate stocks,government or corporate bonds,or mutual funds,these are called

Accepted Answer

A) liquid assets. 
B) long-term assets. 
C) investment assets. 
D) retirement assets. 
A) liquid assets. 
B) long-term assets. 
C) investment assets. 
D) retirement assets.

Question 2

Should Shane be concerned about his liquidity ratio of 80 percent?

Accepted Answer

A) No,he is in good position regarding liquidity. 
B) No,this indicates a healthy cash flow. 
C) Yes,he may have problems covering upcoming payments. 
D) Yes,he may decrease his net worth with too many investments. 
A) No,he is in good position regarding liquidity. 
B) No,this indicates a healthy cash flow. 
C) Yes,he may have problems covering upcoming payments. 
D) Yes,he may decrease his net worth with too many investments.

Question 3

A negative cash flow means net worth will decrease.

Accepted Answer

A) True 
 B)False

Question 4

Describe why some people may need alternative budget strategies? Give an example to illustrate why someone might need the envelope method while someone else needs the pay yourself first method.

Accepted Answer

If someone has good intentions but is st

Question 5

A debt-to-asset ratio above 1 is more important than a liquidity ratio above 1.

Accepted Answer

A) True 
 B)False

Question 6

If you feel your debt-to-asset ratio is low,you should review your cash flows to maximize your income and minimize expenses.

Accepted Answer

A) True 
 B)False

Question 7

Jennifer has assets of $100 000 and debts of $10 000.She could

Accepted Answer

A) borrow more money,since her debt ratio is low. 
B) apply for a bank loan,but expect to be turned down. 
C) borrow approximately $200 000 at below-market rates. 
D) establish an emergency fund of $10 000 in order to qualify for a loan. 
A) borrow more money,since her debt ratio is low. 
B) apply for a bank loan,but expect to be turned down. 
C) borrow approximately $200 000 at below-market rates. 
D) establish an emergency fund of $10 000 in order to qualify for a loan.

Question 8

George has total debts of $10 000,liquid assets of $8000 and current liabilities of $5000.His current ratio is

Accepted Answer

A) 0)8. 
B) 0)63. 
C) 6)3. 
D) 1)6. 
A) 0)8. 
B) 0)63. 
C) 6)3. 
D) 1)6.

Question 9

A high debt-to-asset level is common during the early- to mid-earning life stages.

Accepted Answer

A) True 
 B)False

Question 10

Which of the following is a true statement about mutual funds?

Accepted Answer

A) You get to choose what stocks the mutual fund invests your money in. 
B) A minimum investment is required. 
C) They are only invested in stocks. 
D) The value of shares are not reported in The Globe and Mail or on various websites. 
A) You get to choose what stocks the mutual fund invests your money in. 
B) A minimum investment is required. 
C) They are only invested in stocks. 
D) The value of shares are not reported in The Globe and Mail or on various websites.

Question 11

Nancy has a gross income of $47 000,disposable income of $40000,a net worth of $80000 and saves $8000 a year.Her savings rate is

Accepted Answer

A) 10 percent. 
B) 15 percent. 
C) 17 percent. 
D) 20 percent. 
A) 10 percent. 
B) 15 percent. 
C) 17 percent. 
D) 20 percent.

Question 12

Cash outflows represent your liabilities,such as the pay-off value on your car or home.

Accepted Answer

A) True 
 B)False

Question 13

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

Accepted Answer

A) True 
 B)False

Question 14

Individuals who switch from a low-demand industry to a high-demand industry may earn higher incomes.

Accepted Answer

A) True 
 B)False

Question 15

A personal cash flow statement is usually the starting point for an individual's or family's budget.

Accepted Answer

A) True 
 B)False

Question 16

If you have an increase in monthly disposable income from $4000 to $4500 and an increase in spending of $650 per month,your net cash flow is reduced by $150 per month.

Accepted Answer

A) True 
 B)False

Question 17

Household assets include jewelry and furniture and should be valued at their original cost.

Accepted Answer

A) True 
 B)False

Question 18

Marta has been keen on following her budget for some time,but unexpected expenses such as car repairs or broken appliances always seem to force her to cancel her vacation each year.Suggest what course of action Marta should follow.

Accepted Answer

Marta has not likely budgeted for an eme

Question 19

This month Joshua has $2000 income from his job and $100 interest income.His expenses are rent $500,food and entertainment $400,car expenses $600.He has $40 000 held in bonds and a car loan of $10000 .What is his net worth?

Accepted Answer

A) $30 000 
B) $32 100 
C) $30 600 
D) $30 500 
A) $30 000 
B) $32 100 
C) $30 600 
D) $30 500

Question 20

This month Joshua has $2000 income from his job and $100 interest income.His expenses are rent $500,food and entertainment $400 and car expenses $600.He has $40 000 held in bonds and a car loan of $10 000.What is his cash flow this month?

Accepted Answer

A) $600 
B) $500 
C) -$9400 
D) $30 600 
A) $600 
B) $500 
C) -$9400 
D) $30 600

When a person owns corporate stocks,government or corporate bonds,or mutual funds,these are called

Should Shane be concerned about his liquidity ratio of 80 percent?

A negative cash flow means net worth will decrease.

Describe why some people may need alternative budget strategies? Give an example to illustrate why someone might need the envelope method while someone else needs the pay yourself first method.

A debt-to-asset ratio above 1 is more important than a liquidity ratio above 1.

If you feel your debt-to-asset ratio is low,you should review your cash flows to maximize your income and minimize expenses.

Jennifer has assets of $100 000 and debts of $10 000.She could

George has total debts of $10 000,liquid assets of $8000 and current liabilities of $5000.His current ratio is

A high debt-to-asset level is common during the early- to mid-earning life stages.

Which of the following is a true statement about mutual funds?

Nancy has a gross income of $47 000,disposable income of $40000,a net worth of $80000 and saves $8000 a year.Her savings rate is

Cash outflows represent your liabilities,such as the pay-off value on your car or home.

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

Individuals who switch from a low-demand industry to a high-demand industry may earn higher incomes.

A personal cash flow statement is usually the starting point for an individual's or family's budget.

If you have an increase in monthly disposable income from $4000 to $4500 and an increase in spending of $650 per month,your net cash flow is reduced by $150 per month.

Household assets include jewelry and furniture and should be valued at their original cost.

Marta has been keen on following her budget for some time,but unexpected expenses such as car repairs or broken appliances always seem to force her to cancel her vacation each year.Suggest what course of action Marta should follow.

This month Joshua has $2000 income from his job and $100 interest income.His expenses are rent $500,food and entertainment $400,car expenses $600.He has $40 000 held in bonds and a car loan of $10000 .What is his net worth?

This month Joshua has $2000 income from his job and $100 interest income.His expenses are rent $500,food and entertainment $400 and car expenses $600.He has $40 000 held in bonds and a car loan of $10 000.What is his cash flow this month?

Tools for Financial Planning - Applying Time Value Concepts

Tools for Financial Planning - Using Tax Concepts for Planning

Managing Your Financial Resources - Banking Services and Managing Your Money

Managing Your Financial Resources - Assessing,Managing and Securing Your Credit

Managing Your Financial Resources - Purchasing and Financing a Home

Protecting Your Wealth - Auto and Homeowner's Insurance

Protecting Your Wealth - Health and Life Insurance

Personal Investing - Investing Fundamentals

Personal Investing - Investing in Stocks

Personal Investing - Investing in Bonds

Personal Investing - Investing in Mutual Funds

Retirement and Estate Planning - Retirement Planning

Retirement and Estate Planning - Estate Planning

Synthesis of Financial Planning - Integrating the Components of a Financial Plan

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Exam 1: Tools for Financial Planning - Planning with Personal Financial Statements

When a person owns corporate stocks,government or corporate bonds,or mutual funds,these are called

Should Shane be concerned about his liquidity ratio of 80 percent?

A negative cash flow means net worth will decrease.

Describe why some people may need alternative budget strategies? Give an example to illustrate why someone might need the envelope method while someone else needs the pay yourself first method.

A debt-to-asset ratio above 1 is more important than a liquidity ratio above 1.

If you feel your debt-to-asset ratio is low,you should review your cash flows to maximize your income and minimize expenses.

Jennifer has assets of $100 000 and debts of $10 000.She could

George has total debts of $10 000,liquid assets of $8000 and current liabilities of $5000.His current ratio is

A high debt-to-asset level is common during the early- to mid-earning life stages.

Which of the following is a true statement about mutual funds?

Nancy has a gross income of $47 000,disposable income of $40000,a net worth of $80000 and saves $8000 a year.Her savings rate is

Cash outflows represent your liabilities,such as the pay-off value on your car or home.

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

Individuals who switch from a low-demand industry to a high-demand industry may earn higher incomes.

A personal cash flow statement is usually the starting point for an individual's or family's budget.

If you have an increase in monthly disposable income from $4000 to $4500 and an increase in spending of $650 per month,your net cash flow is reduced by $150 per month.

Household assets include jewelry and furniture and should be valued at their original cost.

Marta has been keen on following her budget for some time,but unexpected expenses such as car repairs or broken appliances always seem to force her to cancel her vacation each year.Suggest what course of action Marta should follow.

This month Joshua has $2000 income from his job and $100 interest income.His expenses are rent $500,food and entertainment $400,car expenses $600.He has $40 000 held in bonds and a car loan of $10000 .What is his net worth?

This month Joshua has $2000 income from his job and $100 interest income.His expenses are rent $500,food and entertainment $400 and car expenses $600.He has $40 000 held in bonds and a car loan of $10 000.What is his cash flow this month?

Tools for Financial Planning - Applying Time Value Concepts

Tools for Financial Planning - Using Tax Concepts for Planning

Managing Your Financial Resources - Banking Services and Managing Your Money

Managing Your Financial Resources - Assessing,Managing and Securing Your Credit

Managing Your Financial Resources - Purchasing and Financing a Home

Protecting Your Wealth - Auto and Homeowner's Insurance

Protecting Your Wealth - Health and Life Insurance

Personal Investing - Investing Fundamentals

Personal Investing - Investing in Stocks

Personal Investing - Investing in Bonds

Personal Investing - Investing in Mutual Funds

Retirement and Estate Planning - Retirement Planning

Retirement and Estate Planning - Estate Planning

Synthesis of Financial Planning - Integrating the Components of a Financial Plan

Filters