Consumer Economics Practice Exam https://quizplus.com/study-set/991 16 Chapters 1387 Verified Questions
Consumer Economics Practice Exam Course Introduction Consumer Economics explores the decision-making processes of individuals and households as they allocate resources to satisfy needs and wants. The course examines fundamental economic concepts from the consumer’s perspective, including budgeting, saving, investing, credit use, risk management, and consumer rights and responsibilities. Topics such as the impact of advertising, consumer protection laws, and the effect of economic policy on consumer behavior are discussed, equipping students with practical tools for making informed financial decisions in their personal and professional lives.
Recommended Textbook Personal Finance 3rd Canadian Edition by Jeff Madura
Available Study Resources on Quizplus 16 Chapters 1387 Verified Questions 1387 Flashcards Source URL: https://quizplus.com/study-set/991
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Chapter 1: Overview of a Financial Plan Available Study Resources on Quizplus for this Chatper 97 Verified Questions 97 Flashcards Source URL: https://quizplus.com/quiz/19493
Sample Questions Q1) An emergency fund is not a component of a long-term financial plan. A)True B)False Answer: False Q2) A car accident which is not fully covered by your insurance is an example of an unexpected expense you cannot plan for. A)True B)False Answer: False Q3) The Financial Planning Standards Council (FPSC)sets out the steps needed to earn the Certified Financial Planner (CFP)designation. A)True B)False Answer: True Q4) If you spend $20 for your dinner,an opportunity cost is that you have forgone the possibility of using that money to buy gasoline for your car. A)True B)False Answer: True To view all questions and flashcards with answers, click on the resource link above. Page 3
Chapter 2: Tools for Financial Planning - Applying Time Value Concepts Available Study Resources on Quizplus for this Chatper 82 Verified Questions 82 Flashcards Source URL: https://quizplus.com/quiz/19494
Sample Questions Q1) An antique was originally purchased 50 years ago for $2 and today is worth $600.What is the approximate annual rate of return realized on the sale of this antique? A)18 percent B)12 percent C)9 percent D)13 percent Answer: B Q2) The future value of $810 deposited today at 7.71 percent compounded annually for four years is closest to A)$1620. B)$1090. C)$1060. D)$1066. Answer: B Q3) The concept of time value of money only applies to rare financial planning problems. A)True B)False Answer: False Page 4 To view all questions and flashcards with answers, click on the resource link above.
Chapter 3: Tools for Financial Planning - Planning with Personal Financial Statements Available Study Resources on Quizplus for this Chatper 101 Verified Questions 101 Flashcards Source URL: https://quizplus.com/quiz/19495
Sample Questions Q1) Student loans,car loans,and mortgages are good examples of A)long-term liabilities. B)current liabilities. C)short-term debts. D)household liabilities. Answer: A Q2) If you do not budget for unexpected expenses,you will likely experience A)cash shortages. B)an increase in your emergency fund. C)an increase in assets. D)chronic stress-related issues. Answer: A Q3) Which of the following is not a cash inflow? A)Interest received B)Dividend income C)Car payment D)Salary Answer: C To view all questions and flashcards with Page answers, 5 click on the resource link above.
Chapter 4: Tools for Financial Planning - Using Tax Concepts for Planning Available Study Resources on Quizplus for this Chatper 87 Verified Questions 87 Flashcards Source URL: https://quizplus.com/quiz/19496
Sample Questions Q1) Tax evasion occurs when taxpayers attempt to deceive Canada Revenue Agency by knowingly reporting less tax payable than what the law requires them to pay. A)True B)False Q2) Which of the following would produce the largest financial benefit to a tax payer who earns $96000 and is in the forty percent marginal tax bracket and the twenty five percent average tax bracket? Assume that all items are options of equal importance. A)A $5000 contribution to his/her child's RESP B)A $5000 medical expenses amount for orthodontics C)A $5000 contribution to his/her TFSA D)A $5000 contribution to his/her RRSP Q3) RRSP rules limit a taxpayer's contributions to the higher of 18 percent of total income to a maximum amount of $25 000. A)True B)False Q4) A capital gain results from profit on the sale of capital assets. A)True B)False Page 6 To view all questions and flashcards with answers, click on the resource link above.
Chapter 5: Managing Your Financial Resources - Banking Services and Managing Your Money Available Study Resources on Quizplus for this Chatper 83 Verified Questions 83 Flashcards Source URL: https://quizplus.com/quiz/19497
Sample Questions Q1) Mortgage companies A)take deposits,savings,and term deposits and lend the money to home buyers. B)act as intermediaries to provide mortgages for home buyers. C)facilitate the purchase and sale of mortgages. D)allow individual investors to achieve higher returns by direct investment in mortgages. Q2) Which of the following is an advantage of using a debit card? A)Your total banking expenses are likely to be lower. B)The overdraft protection is less expensive than borrowing from your credit card. C)They have lower transaction fees than credit cards. D)You have no risk of being charged for insufficient funds. Q3) An example of a depository financial institution is an insurance company. A)True B)False Q4) A stop payment on a cheque A)only applies when you write a cheque. B)can only be accomplished if the cheque has not cleared. C)is free if your cheque book is lost or stolen. D)is a regular service for most customers. Page 7 To view all questions and flashcards with answers, click on the resource link above.
Chapter 6: Managing Your Financial Resources - Assessing, Managing, and Securing Your Credit Available Study Resources on Quizplus for this Chatper 99 Verified Questions 99 Flashcards Source URL: https://quizplus.com/quiz/19498
Sample Questions Q1) The loan contract identifies all but which of the following? A)Credit score B)Amount of the loan C)Interest rate D)Loan repayment schedule Q2) Which of the following is not an element of a credit report? A)Employer B)Length of relationship with creditors C)Marital status D)Your previous address Q3) When do you need to use a credit repair service? A)When you find an error on your credit report which is negatively affecting your score B)At the point that you need to work with the trustee in bankruptcy to develop a consumer proposal C)A credit repair company should be contacted only as a last resort to avoid bankruptcy. D)Never,as they have no special powers to correct information on your credit report. To view all questions and flashcards with answers, click on the resource link above. Page 8
Chapter 7: Managing Your Financial Resources Purchasing and Financing a Home Available Study Resources on Quizplus for this Chatper 79 Verified Questions 79 Flashcards Source URL: https://quizplus.com/quiz/19499
Sample Questions Q1) Which would be the best mortgage option if you anticipate a windfall in the next year or two? A)A one-year closed fixed-rate mortgage B)A closed convertible five-year VRM C)An open variable-rate mortgage D)A closed two-year VRM Q2) Which of the following is accurate regarding types of mortgages? A)A convertible VRM gives you protection in case interest rates go up. B)Open mortgages offer slightly better rates than closed mortgages. C)Most fixed-rate mortgages are convertible. D)With a variable-rate mortgage your payments will go up if prime goes up. Q3) A 15-year mortgage compared to a 30-year mortgage has A)higher total principal payments. B)lower monthly payments. C)higher total payments. D)lower total payments. Q4) Since real estate agents are licensed and bonded,they are required to give you unbiased information about real estate purchases. A)True B)False
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Chapter 8: Protecting Your Wealth - Auto and Homeowner's Insurance Available Study Resources on Quizplus for this Chatper 88 Verified Questions 88 Flashcards Source URL: https://quizplus.com/quiz/19500
Sample Questions Q1) Most standard home insurance policies provide coverage for A)earthquake damage. B)liability. C)flood damage. D)computers. Q2) A higher insurance deductible reduces the amount of coverage provided by homeowner's insurance,and therefore results in a lower insurance premium. A)True B)False Q3) In general,insurance companies generate their profit from A)overestimating the value of client claims and keeping the difference as profit. B)investing the proceeds of premiums until the funds are needed to cover claims. C)selling a lot of certain kinds of highly profitable insurance products. D)only insuring people who are low risk to claim. Q4) Insurance companies generate their revenue from charging premiums well above what they anticipate paying out in claims. A)True B)False Page 10 To view all questions and flashcards with answers, click on the resource link above.
Chapter 9: Protecting Your Wealth - Health and Life Insurance Available Study Resources on Quizplus for this Chatper 95 Verified Questions 95 Flashcards Source URL: https://quizplus.com/quiz/19501
Sample Questions Q1) Now that you have studied home,auto,liability,health,disability,critical illness,and long-term care insurance coverage,you should have a good understanding of how they relate to your financial plan.With respect to each type of insurance,discuss the relative importance that each type has to your current understanding of financial planning.Rank the importance of each type of coverage as it pertains to you personally.What types of insurance could you do without? What coverage can you not do without under your present circumstances? What types of insurance would you consider adding to your plan as your lifestyle changes? Q2) The income method,basing life insurance needs on multiples of current income,is the most useful method for determining how much life insurance a person should buy. A)True B)False Q3) While the Canada Health Act is federal legislation,it is the responsibility of the provinces and territories to Administer and deliver health care services. A)True B)False Q4) From the employer's perspective,describe four advantages for group health insurance plans. Page 11 To view all questions and flashcards with answers, click on the resource link above.
Chapter 10: Personal Investing - Investing Fundamentals Available Study Resources on Quizplus for this Chatper 87 Verified Questions 87 Flashcards Source URL: https://quizplus.com/quiz/19502
Sample Questions Q1) Preferred shares always pay their dividends. A)True B)False Q2) To measure an investment's risk,which of the following would you use? A)Time value of money B)Range of returns on the entire market C)Standard deviation of returns D)Standard deviation of prices Q3) Real estate is a good investment option for individuals and it offers the same liquidity as stocks or bonds. A)True B)False Q4) If you wish to have a direct voice in the running of a company,you should purchase A)directorships. B)debentures. C)common stock. D)preferred stock. To view all questions and flashcards with answers, click on the resource link above.
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Chapter 11: Personal Investing - Investing in Stocks Available Study Resources on Quizplus for this Chatper 84 Verified Questions 84 Flashcards Source URL: https://quizplus.com/quiz/19503
Sample Questions Q1) How much should a share of stock be worth for a firm whose earnings per share are $4 if the industry's average P/E is 11? A)$40 B)$44 C)$48 D)$88 Q2) A brokerage firm currently limits the margin rate to 70 percent.The amount that can be borrowed for a transaction to buy 100 shares at $50 is A)$4000. B)$3500. C)$5000. D)$1500. Q3) Low interest rates can increase demand for stocks and therefore have a direct impact on stock prices. A)True B)False Q4) The Toronto Stock Exchange (TSX)is the only Canadian stock exchange. A)True B)False To view all questions and flashcards with answers, click on the resource link above. Page 13
Chapter 12: Personal Investing - Investing in Bonds Available Study Resources on Quizplus for this Chatper 84 Verified Questions 84 Flashcards Source URL: https://quizplus.com/quiz/19504
Sample Questions Q1) A real return bond with a 7 percent coupon will increase its interest payment annually to $71.40 if inflation rises by 2 percent. A)True B)False Q2) A bond's yield to maturity is the annualized percentage return of both interest and capital gains or losses if the bond were held until it matured. A)True B)False Q3) The normal yield curve suggests A)that reinvestment risk is higher for higher coupon rates. B)that selecting short-term maturities for borrowing and long term for investing will be profitable. C)that interest rate risk is higher for longer-term bonds. D)that short-term bonds give the best risk return trade-off. Q4) The amount returned to the investor when a bond matures is called A)principal. B)interest gain. C)capital gain. D)terminal value. To view all questions and flashcards with answers, click on the resource link above. Page 14
Chapter 13: Personal Investing - Investing in Mutual Funds Available Study Resources on Quizplus for this Chatper 83 Verified Questions 83 Flashcards Source URL: https://quizplus.com/quiz/19505
Sample Questions Q1) You own 500 units of a fund that now has a NAV of $12.30.What is your total investment worth? A)$6150 B)$61 500 C)$6150,minus the load fee D)$6150,plus the load fee Q2) A fund with a favourable historical track record is likely to continue to outperform funds with similar objectives in the future. A)True B)False Q3) Treasury bill funds have A)high liquidity and inflation risk and low default risk. B)high interest rate risk and low default risk. C)low interest rate risk and default risk. D)low interest rate risk,no default risk and high inflation risk. Q4) Which of the following is a stock mutual fund? A)Asset allocation fund B)Balanced growth and income C)Mid-cap fund D)Money market fund Page 15 To view all questions and flashcards with answers, click on the resource link above.
Chapter 14: Retirement and Estate Planning - Retirement Planning Available Study Resources on Quizplus for this Chatper 82 Verified Questions 82 Flashcards Source URL: https://quizplus.com/quiz/19506
Sample Questions Q1) If you want to save $1 000 000 for retirement with $200 monthly deposits at eight percent interest compounded monthly,how long will it take? A)50 years,1 month B)43 years,3 months C)44 years,4 months D)44 years,1 month Q2) If,at regular retirement age,you would have qualified for $1000 CPP income and $500 OAS income,what monthly income would you receive if you deferred them both by five years? A)$1950 B)$2100 C)$2130 D)$2040 Q3) Old Age Security benefits A)can be deferred five years which would increase your benefit by 36%. B)are clawed back for people whose income is above $50,000. C)can be claimed at age 60,but at a reduced amount. D)are a nontaxable benefit. To view all questions and flashcards withPage answers, 16 click on the resource link above.
Chapter 15: Retirement and Estate Planning - Estate Planning Available Study Resources on Quizplus for this Chatper 79 Verified Questions 79 Flashcards Source URL: https://quizplus.com/quiz/19507
Sample Questions Q1) When considering holding assets as joint ownership with rights of survivorship for estate planning purposes,it is important to understand A)that capital gains taxes will be deferred on this transaction until the survivor passes. B)how the spousal roll-over rules will impact capital gains taxation. C)the implications of giving up your decision making power over the asset. D)that naming a child as a joint owner of your principal residence will trigger capital gains taxes. Q2) In the year of death,contributions to registered charitable organizations through your will A)can be made to a family member. B)are restricted to 75 percent of gross income. C)can be 100 percent of net income and that of the preceding year. D)is capped at $75 000. Q3) If you die without a will,the court will appoint A)a grantor. B)an attorney. C)an administrator. D)a settlor. To view all questions and flashcards withPage answers, 17 click on the resource link above.
Chapter 16: Synthesis of Financial Planning - Integrating the Components of a Financial Plan Available Study Resources on Quizplus for this Chatper 77 Verified Questions 77 Flashcards Source URL: https://quizplus.com/quiz/19508
Sample Questions Q1) The purpose of financial planning is to help do all of the following except A)set goals. B)decrease your food expenses. C)become financially educated. D)increase your net worth. Q2) Monitoring liquidity includes tracking your A)RRSP balances. B)emergency funds. C)TFSA growth stocks. D)mortgage balance. Q3) An example of compounding is A)buying stocks that do not pay dividends. B)buying a strip bond. C)using dividends to pay your cell phone bill. D)reinvesting dividends to purchase more units. Q4) Trust agreements in financial plans are normally are used for A)wills. B)powers of attorney. C)financial security. D)estate planning.
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