Consumer Finance
Exam Bank
Course Introduction
Consumer Finance explores the financial decisions faced by individuals and households, focusing on topics such as budgeting, savings, credit management, loans, insurance, and retirement planning. The course examines the principles of personal financial management, consumer credit, and investment choices, while also addressing behavioral and psychological factors that affect financial decision-making. Students will gain practical knowledge and skills to manage personal finances responsibly, understand financial products and services, and navigate the complex landscape of consumer financial markets.
Recommended Textbook
Personal Finance 2nd Edition by Robert B. Walker
Available Study Resources on Quizplus
17 Chapters
1143 Verified Questions
1143 Flashcards
Source URL: https://quizplus.com/study-set/3290 Page 2
Chapter 1: Money Matters: Values, vision, mission, and You
Available Study Resources on Quizplus for this Chatper
90 Verified Questions
90 Flashcards
Source URL: https://quizplus.com/quiz/65328
Sample Questions
Q1) Passive income is money you receive from
A)investments and savings.
B)salaries.
C)tips and wages.
D)All of the options are correct.
Answer: A
Q2) Which is an example of a personal mission statement?
A)To live every day to the fullest with compassion and understanding
B)To retire when I'm 50 and move to Florida
C)To have a huge wedding with family and friends
D)To buy a fancy car
Answer: A
Q3) What country was declared the "Happiest Place on Earth"?
A)The United States
B)Germany
C)Finland
D)Denmark
Answer: D
To view all questions and flashcards with answers, click on the resource link above.
3
Chapter 2: Planning and Budgeting
Available Study Resources on Quizplus for this Chatper
63 Verified Questions
63 Flashcards
Source URL: https://quizplus.com/quiz/65327
Sample Questions
Q1) If you want to save money,what is the most important lesson you need to learn?
A)Do not change anything
B)Pay yourself first
C)Spend more money
D)Get a credit card
Answer: B
Q2) If you wanted to have $1,800 saved up by the end of the year,what amount would you need to save on a daily basis?
A)$4.93
B)$5.00
C)$10.00
D)$3.50
Answer: A
Q3) On a balance sheet,you calculate how much your personal property is worth based on what?
A)How much you bought it for
B)What it would sell for at a garage sale
C)How much it would be to replace it
D)How much you want it to be worth
Answer: B
To view all questions and flashcards with answers, click on the resource link above. Page 4
Chapter 3: Financial Instruments and Institutions
Available Study Resources on Quizplus for this Chatper
74 Verified Questions
74 Flashcards
Source URL: https://quizplus.com/quiz/65326
Sample Questions
Q1) At a commercial bank,a checking account is referred to as
A)a demand deposit account.
B)a share draft account.
C)negotiable.
D)a debit account.
Answer: A
Q2) A prepaid tuition plan does not include
A)locking into prices at eligible and public and private colleges and universities.
B)state plans guaranteed or backed by the state.
C)age/grade limits for the beneficiary.
D)open enrollment all year.
Answer: D
Q3) Checking account overdraft protection
A)saves you money in overdraft fees.
B)saves your reputation.
C)saves you time.
D)all of the options are correct.
Answer: D
To view all questions and flashcards with answers, click on the resource link above. Page 5
Chapter 4: Time Value of Money
Available Study Resources on Quizplus for this Chatper
55 Verified Questions
55 Flashcards
Source URL: https://quizplus.com/quiz/65325
Sample Questions
Q1) The annual percentage yield (APY)is the effective monthly rate of return taking into account the effect of compounding interest.
A)True
B)False
Q2) What is a lump sum?
A)A single,one-time payment
B)All of your money is put together in a pile
C)A series of equal payments that are made at equal intervals over time
D)The value of an amount based on the interest rate
Q3) Paper money is backed by the full faith of the U.S.government and the Federal Reserve Bank.
A)True
B)False
Q4) What two cities are currently producing coins for general circulation?
A)Denver and Philadelphia
B)Philadelphia and San Francisco
C)Denver and San Francisco
D)Fort Worth and Washington,D.C.
To view all questions and flashcards with answers, click on the resource link above. Page 6
Chapter 5: Consumer Credit: Credit Cards and Student Loans
Available Study Resources on Quizplus for this Chatper
79 Verified Questions
79 Flashcards
Source URL: https://quizplus.com/quiz/65324
Sample Questions
Q1) If you have a subsidized loan,what is the best time to start repaying it?
A)After graduating
B)During school
C)Right after you get the loan
D)After you start graduate school
Q2) Which of the following are helpful in keeping your credit card rates and fees low?
A)Make every payment on time
B)Maintain a balance that is less than 30% of your credit line
C)Carefully read monthly statements for additional fees and read mail regarding adjustment notices
D)All of the options are correct.
Q3) If you pay off a $3,600 loan in 12 equal payments over 1 year at 1% monthly simple interest,how much will your payments be each month?
A)$291.67
B)$319.86
C)$318.43
D)None of the options are correct.
To view all questions and flashcards with answers, click on the resource link above.
Page 7
Chapter 6: Credit Bureau Reports and Identity Theft
Available Study Resources on Quizplus for this Chatper
96 Verified Questions
96 Flashcards
Source URL: https://quizplus.com/quiz/65323
Sample Questions
Q1) What is the most common form of identity theft?
A)Unauthorized use of a credit card,debit card,or check
B)Using another person's personal information to obtain credit
C)Using another person's personal information to obtain a job
D)Using another person's personal information to travel to another country
Q2) You spend $1,000 on your credit card,and the minimum payment is $10 a month.If you pay double the minimum payment,what will happen?
A)You will pay the debt off more quickly.
B)You will end up in perma-debt.
C)You will pay off the debt more slowly.
D)None of the options are correct.
Q3) Which of the following are ways to improve your FICO credit score?
A)Pay your bills on time
B)Limit the number of new credit accounts
C)Keep credit card balances low
D)All of the options are correct.
Q4) The simplest,most common form of credit is a debit card.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above. Page 8
Chapter 7: Auto and Home Loans
Available Study Resources on Quizplus for this Chatper
62 Verified Questions
62 Flashcards
Source URL: https://quizplus.com/quiz/65322
Sample Questions
Q1) Car lease payments are usually
A)lower than loan payments.
B)higher than loan payments.
C)never a good investment.
D)about the same as loan payments.
Q2) Which of the following is more likely to charge you more money when you buy a car?
A)An ad in the paper
B)An ad on Craigslist
C)Your local car dealership
D)A sign in a car window
Q3) What does HELOC stand for?
A)Health expense license of California
B)Home equity line of credit
C)Home equity liquidation of credit
D)None of the answers are correct.
Q4) If a homeowner is in foreclosure,the home equity loan is repaid first since that was the last loan to be negotiated.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above. Page 9
Chapter 8: Debt,foreclosure,and Bankruptcy
Available Study Resources on Quizplus for this Chatper
70 Verified Questions
70 Flashcards
Source URL: https://quizplus.com/quiz/65321
Sample Questions
Q1) Stanley experienced many financial problems and ended up filing for bankruptcy.Now,he is looking to restore his credit and develop good financial habits.Which of the following will help Stanley establish good habits after his bankruptcy?
A)Pay everything on time
B)Change his lifestyle by using self-control and self-discipline to stay within his budget
C)Don't use credit; if Stanley wants or needs something,he should save up money for it
D)All of the choices are correct.
Q2) What is the quickest and simplest form of bankruptcy?
A)Chapter 13
B)Chapter 8
C)Chapter 7
D)Chapter 5
Q3) What is the first step of digging out of debt?
A)Create a realistic budget
B)Make payments on time
C)Stop using credit cards
D)Don't try to buy stuff you can't afford
To view all questions and flashcards with answers, click on the resource link above.
Chapter 9: Tax Management
Available Study Resources on Quizplus for this Chatper
84 Verified Questions
84 Flashcards
Source URL: https://quizplus.com/quiz/65320
Sample Questions
Q1) Who pays 6.2% of an employee's salary toward Social Security tax and 1.45% toward Medicare?
A)The employee
B)The employer
C)Both the employee and the employer
D)The employee and the employer split it
Q2) How do you calculate your average tax rate?
A)Divide your total income taxes paid by your total income
B)Divide your total income by your deductions
C)The difference between your income and taxes paid
D)The difference between your deductions and total income
Q3) There are ________ filing statuses.
A)7
B)6
C)5
D)4
Q4) Only U.S.citizens are required to file Form 1040EZ,Form 1040A,or Form 1040.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above. Page 11
Chapter 10: Insurance: Covering Your Assets
Available Study Resources on Quizplus for this Chatper
88 Verified Questions
88 Flashcards
Source URL: https://quizplus.com/quiz/65319
Sample Questions
Q1) You have a co-pay of $50.00 per clinic visit and a maximum out-of-pocket expense of $500.How many times can you visit the doctor this year before you no longer have to make the copayment?
A)5
B)10
C)50
D)100
Q2) Term life insurance covers you for a fixed amount over a certain time period at a relatively low cost.
A)True
B)False
Q3) The insurance declaration page states
A)the cost of insurance.
B)the maximum an insurance company will pay.
C)who is not covered under the policy.
D)All options are correct.
Q4) Other forms of disability pay include Social Security and the state's workers' compensation program.
A)True
B)False
Page 12
To view all questions and flashcards with answers, click on the resource link above.
Chapter 11: Investment Basics
Available Study Resources on Quizplus for this Chatper
56 Verified Questions
56 Flashcards
Source URL: https://quizplus.com/quiz/65318
Sample Questions
Q1) Ten years ago,your grandparents gifted you a 20-year,$1,000 bond.The interest rate at the time of purchase was 5%.Today,comparable bonds are paying 7%.Approximately how much could you sell this bond for?
A)$860
B)$800
C)$918
D)$1,200
Q2) If you have a high-risk tolerance,and you want to invest money for the long term,you might invest in ________.
A)certificates of deposit
B)fixed-income mutual funds and high-grade corporate bonds
C)balanced mutual funds
D)precious metals
Q3) A reason not to invest in a mutual fund is that you have a targeted retirement date and you would like to reduce your market risks gradually as you approach retirement.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above. Page 13
Chapter 12: Mutual Funds
Available Study Resources on Quizplus for this Chatper
57 Verified Questions
57 Flashcards
Source URL: https://quizplus.com/quiz/65317
Sample Questions
Q1) ________ investing describes an investment strategy which seeks to maximize both financial return and social good.
A)Socially responsible
B)Environmental stewardship
C)Consumer protection
D)Human rights
Q2) Where can you find information about fund managers and their investment experience?
A)www.Morningstar.com
B)MFS Investment Management Annual Report
C)Securities and Exchange Commission monthly publication
D)DOW monthly journal
Q3) Measuring fund performance against the S&P 500 can show the consistency of the fund's returns; only about ________ of the fund managers beat the S&P 500 consistently,and they usually have higher expense ratios than index funds.
A)5%
B)10%
C)15%
D)25%
To view all questions and flashcards with answers, click on the resource link above.
Page 14
Chapter 13: Stocks
Available Study Resources on Quizplus for this Chatper
68 Verified Questions
68 Flashcards
Source URL: https://quizplus.com/quiz/65316
Sample Questions
Q1) A ________ P/E suggests that investors are expecting higher earnings growth in the future.
A)high
B)low
C)climbing
D)falling
Q2) When you buy or sell stock,________.
A)it is free through a discount broker
B)there is always a transaction cost,which should be calculated in your total return
C)using a full service broker provides the least total return and is your least expensive alternative
D)you should understand that it is too expensive to make money on small orders
Q3) Why are some stocks exchanged over the counter?
A)Lower start-up cost for the company
B)Lower trading cost for the company
C)Company is too small to meet the requirements of the exchange
D)Company has not been in business long enough to be accepted in the exchange
To view all questions and flashcards with answers, click on the resource link above. Page 15
Chapter 14: Bonds
Available Study Resources on Quizplus for this Chatper
71 Verified Questions
71 Flashcards
Source URL: https://quizplus.com/quiz/65315
Sample Questions
Q1) Buying and selling corporate bonds is as easy as buying and selling stocks,given that bonds tend to trade every few days and there are fewer buyers and sellers.
A)True
B)False
Q2) www.TreasuryDirect.gov is ________.
A)only for major investors who can buy U.S.government bonds
B)the only place to buy Treasury bills,notes,and bonds
C)too complicated for the common person to understand D)where anyone can go to purchase EE-Bonds,I-Bonds,and Treasury bills,notes,and bonds
Q3) A bond ladder ________.
A)helps reduce the risk of interest rates changes by spacing out the maturities
B)refers to monthly contributions into a bond mutual fund
C)guarantees that you will always get the best interest rates on the bonds you invest in D)is a strategy that helps you achieve your financial goals by "climbing the ladder"
To view all questions and flashcards with answers, click on the resource link above. Page 16
Chapter 15: Real Estate Investments
Available Study Resources on Quizplus for this Chatper
58 Verified Questions
58 Flashcards
Source URL: https://quizplus.com/quiz/65314
Sample Questions
Q1) The return on investment for flipping houses is driven by ________.
A)price
B)value
C)leverage
D)timing
Q2) What is meant by "flipping" properties?
A)To pool funds from a group of individuals and invest in real estate
B)To buy,upgrade,and sell property over a short time period for a profit
C)To switch properties with someone randomly
D)To have the bank take ownership of a property
Q3) Most real estate agents charge ________ as a commission to sell your property.
A)1-2%
B)3-5%
C)6-7%
D)8%
Q4) Which of the following is not included in a security prospectus?
A)Terms
B)Issuer
C)Objective
D)Historical financial statements
Page 17
To view all questions and flashcards with answers, click on the resource link above.
Chapter 16: Retirement and Estate Planning
Available Study Resources on Quizplus for this Chatper
49 Verified Questions
49 Flashcards
Source URL: https://quizplus.com/quiz/65313
Sample Questions
Q1) What must you do to deduct donations to a political campaign from your taxes?
A)Donate at least $1,000
B)Select a party to support on your tax return
C)Retain the receipt for one year
D)You are not able to deduct donations to a political campaign.
Q2) If you have 10 children and you and your spouse want to maximize the amount you can give to each child each year before you have to pay gift tax (use the 2016 rate),what is the maximum amount each child can receive each year?
A)$14,000
B)$28,000
C)$140,000
D)$280,000
Q3) Which is not a reason to start saving for retirement?
A)Family
B)Sabbatical
C)Change of heart
D)None of the options are correct.
Q4) Those who are self-employed can invest in a simplified employee pension plan.
A)True
B)False
Page 18
To view all questions and flashcards with answers, click on the resource link above.
Chapter 17: Financial Planning for Life
Available Study Resources on Quizplus for this Chatper
23 Verified Questions
23 Flashcards
Source URL: https://quizplus.com/quiz/65312
Sample Questions
Q1) When finding a balance with your own financial wellness,which aspect involves eliminating the nonessentials?
A)Minimize
B)Organize
C)Economizes
D)Energize
Q2) Frugality is not about being cheap or about deprivation; instead it is about being creative and finding savings and more efficient ways to achieve your objectives.
A)True
B)False
Q3) What is frugality?
A)Spending your money according to your priorities and vision for the future
B)Being creative and finding savings and more efficient ways to achieve your objectives
C)Being in control of your income and expenses
D)All of the options are correct.
To view all questions and flashcards with answers, click on the resource link above.
19