Family Financial Management
Final Exam Questions
Course Introduction
Family Financial Management explores the principles and practices of effectively managing financial resources within the family unit. The course covers topics such as budgeting, saving, investing, debt management, insurance, retirement planning, and financial decision-making across various life stages. Emphasis is placed on goal-setting, maximizing resources, understanding consumer rights and responsibilities, and preparing for financial challenges. Students will develop practical skills for creating financial plans, analyzing spending patterns, and making informed financial choices to promote economic security and well-being for families.
Recommended Textbook
Personal Finance 4 4th Edition by Lawrence J. Gitman
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15 Chapters
2587 Verified Questions
2587 Flashcards
Source URL: https://quizplus.com/study-set/3514
Page 2
Chapter 1: Understanding the Financial Planning Process
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136 Verified Questions
136 Flashcards
Source URL: https://quizplus.com/quiz/69803
Sample Questions
Q1) [Putting money into a retirement fund | Buying a car] would be an example of current consumption.
Answer: B
Q2) Income tends to [increase | decrease] between the ages of 55 and 75.
Answer: B
Q3) The government employs monetary and fiscal policy to ensure the economy always remains stable.
A)True
B)False
Answer: False
Q4) Financial planning can improve your standard of living.
A)True
B)False
Answer: True
Q5) Wealth is the key consideration in establishing financial goals as it is used as a measure of value in financial transactions.
A)True
B)False
Answer: False
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Chapter 2: Using Financial Statements and Budgets
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174 Verified Questions
174 Flashcards
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Sample Questions
Q1) Sam and his wife Ann purchased a home in Lubbock,Texas in 1980 for $100,000.Their original home mortgage was for $90,000.The house has a current market value of $175,000 and a replacement value of $200,000.They still owe $55,000 on their home mortgage.Sam and Ann are now constructing their balance sheet.How should their home be reflected on their current personal balance sheet?
A) $200,000 asset and $55,000 liability
B) $200,000 asset and $90,000 liability
C) $175,000 asset and $55,000 liability
D) $175,000 asset and $90,000 liability
E) $100,000 asset and $55,000 liability
Answer: C
Q2) You would not include _____ on an income and expenditures statement.
A) the value of your stock portfolio
B) taxes withheld
C) utilities paid
D) mortgage payments
E) charitable payments
Answer: A
Q3) Financial planning and budgeting [do | do not] mean the same thing.
Answer: B
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Chapter 3: Preparing Your Taxes
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191 Verified Questions
191 Flashcards
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Sample Questions
Q1) The Medicare portion of the Social Security tax is paid on 100% of earnings.
A)True
B)False
Answer: True
Q2) Shawn earned $65,000.If the total Social Security tax rate is 15.3% then how much was his social security tax? How much would his employer pay in social security taxes for Shawn?
Answer: Alex paid social security tax of $4,973 [(.153 × $65,000)/ 2]. Alex's employer would also pay $4,973.
Q3) You are preparing your own tax return.The least costly source for answering your questions would be:
A) IRS 800- 829-1040 toll-free number.
B) private preparation service.
C) tax accountant.
D) tax lawyer.
E) local post office.
Answer: A
Q4) The major source of revenue for the federal government is [income | Social Security] taxes.
Answer: A
Page 5
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Chapter 4: Managing Your Cash and Savings
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189 Verified Questions
189 Flashcards
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Sample Questions
Q1) Credit unions are:
A) member owned financial cooperative.
B) mortgage lenders.
C) available to the general public.
D) special commercial lenders.
E) not providers of insured deposits.
Q2) Credit union members are expected to have some common bond.
A)True
B)False
Q3) Saving accounts are sometimes referred to as demand deposits.
A)True
B)False
Q4) A _____ is an interest-bearing checking account.
A) certificate of deposit
B) Treasury bill
C) NOW account
D) Series EE U.S.savings bond
E) regular checking account
Q5) A bank customer would expect to be able to write checks on his regular checking account and on his [certificate of deposit | NOW account].
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Chapter 5: Making Automobile and Housing Decisions
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198 Verified Questions
198 Flashcards
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Sample Questions
Q1) A major variable cost of owning a car is [the loan payment | gasoline].
Q2) You made an $800 mortgage payment.The interest on the mortgage for this month was $850.You have just experienced [negative | positive] amortization.
Q3) Phil and Christina are recently married and are unsure of where they will be relocated after Christina finishes her residency in 9 months.Based on this information,which of the following housing recommendations would be most appropriate for them?
A) Rent a home
B) Buy a condominium
C) Buy a single-family dwelling
D) Buy a cooperative apartment
E) Lease a car
Q4) A closed-end automobile lease is the most popular type of lease.
A)True
B)False
Q5) As home prices have fallen the "rent ratio" has [increased | decreased].
Q6) You are paying on a car loan,a furniture loan,and a student loan.This will have [an | no] effect on the lender's decision to grant you a mortgage loan.
Q7) The term condominium/townhome refers to a type of [architecture | ownership].
Page 7
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Chapter 6: Using Credit
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164 Verified Questions
164 Flashcards
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Sample Questions
Q1) Bank credit card cash advances will begin accruing interest charges immediately.
A)True B)False
Q2) Bank credit card purchases always begin accruing interest charges immediately.
A)True
B)False
Q3) Always paying cash is helpful in establishing a high level of creditworthiness.
A)True
B)False
Q4) Interest will usually begin to accrue immediately when you use a bank credit card to:
A) make purchases.
B) send payments.
C) compute finance charges.
D) get cash advances.
E) all of these
Q5) Paying a loan ahead of schedule is one way to build a good credit rating.
A)True B)False
Q6) A proper use of open account credit would be to buy [food | washing machine].
Page 8
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Chapter 8: Insuring Your Life
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153 Verified Questions
153 Flashcards
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Sample Questions
Q1) A life insurance contract contains clauses for:
A) settlement options.
B) policy reinstatement.
C) beneficiary clause.
D) all of the above
E) none of the above
Q2) The basic purpose of insurance is to:
A) protect your health.
B) protect yourself from economic losses.
C) supplement your income.
D) shield you from bad decisions.
E) none of these
Q3) The premium on your term insurance will [increase | stay the same] with each renewal.
Q4) With traditional whole life policies sold by an agent,sales commissions and marketing expenses can increase the costs of a fully loaded policy.
A)True
B)False
Q5) Smoking [will | will not] be a factor in determining life insurance premiums.
Q6) People share losses through [loss control | insurance].
Page 10
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Chapter 9: Insuring Your Health
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154 Verified Questions
154 Flashcards
Source URL: https://quizplus.com/quiz/69811
Sample Questions
Q1) Hospitalization insurance policies will pay for all hospital expenditures most of the time.
A)True
B)False
Q2) Payments under social security disability benefits are available to those who are unable to work for atleast a year.
A)True
B)False
Q3) Disability income benefits under social security are automatically adjusted periodically for cost of living increases.
A)True
B)False
Q4) When there is a co-insurance or participation clause in a health insurance policy,the amount the insurance will pay is computed [before | after] the deductible is paid.
Q5) Medicare and Medicaid are hospital and physicians coverage,respectively. A)True
B)False
Q6) The average age of the American population is [decreasing | increasing].
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Chapter 10: Protecting Your Property
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189 Verified Questions
189 Flashcards
Source URL: https://quizplus.com/quiz/69812
Sample Questions
Q1) Homeowners' insurance premiums are determined by:
A) policy limits.
B) perils covered.
C) deductibles chosen.
D) all of these
E) none of these
Q2) Your son left his skateboard at the bottom of the basement stairs.While going downstairs to change a broken light bulb,you step on the skateboard and break your ankle during the fall.Medical damages total $1,455.How much will your $140,000 homeowners' insurance policy pay for this accident? The policy has $100,000 comprehensive liability coverage and medical payments of $1,000/person.
A) $ 0
B) $ 250
C) $ 500
D) $1,000
E) $1,455
Q3) Replacement cost coverage is available for renters but requires an extra premium.
A)True
B)False
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Page 12
Chapter 11: Investment Planning
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168 Verified Questions
168 Flashcards
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Sample Questions
Q1) Securities sold in the primary markets are usually handled by a(n):
A) commercial banker.
B) broker.
C) investment banker.
D) dealer.
E) none of these
Q2) According to recent legislation,under the FDIC each brokerage account is insured up to $250,000.
A)True
B)False
Q3) Brokers charge a commission on security purchases as well as on security sales.
A)True
B)False
Q4) The federal government regulates securities markets through the:
A) Department of Commerce.
B) Federal Reserve System.
C) National Association of Securities Dealers.
D) Securities and Exchange Commission.
E) Federal Securities Agency.
Q5) [Speculating | Investing] is considered to be a long-term activity.
Page 13
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Chapter 14: Planning for Retirement
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208 Verified Questions
208 Flashcards
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Sample Questions
Q1) There is a [5% | 10%] federal income tax penalty for pension plan withdrawals before age 59 1/2.
Q2) One often has to make investment decision if you have a _____ plan.
A) Cash balance
B) Defined benefit
C) 401(k)
D) a and b
E) a and c
Q3) It really makes little difference whether you start retirement savings at age 25 or at age 45.
A)True
B)False
Q4) You would most likely purchase an annuity from a bank.
A)True
B)False
Q5) Most people today must have worked in a job covered by Social Security for the equivalent of at least [4 years | 10 years] to be fully insured and therefore eligible for retirement benefit payments.
Q6) [401(k)| 403(b)] plans would be available for employees of a public,nonprofit organization.
Page 16
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Chapter 15: Preserving Your Estate
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160 Verified Questions
160 Flashcards
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Sample Questions
Q1) When you die intestate,you have given the court or state the privilege of determining:
A) tax deadlines.
B) burial arrangements.
C) guardians of property.
D) beneficiary needs.
E) divisions of estate to charities.
Q2) You would create a [living | testamentary] trust to be used during your lifetime.
Q3) Knowing where parents keep important documents is a step for estate planning process.
A)True
B)False
Q4) A tenancy by the entirety consists of:
A) husband and wife only.
B) immediate family members.
C) immediate and extended family members.
D) extended family members.
E) none of the above
Q5) If a gift tax has to be paid,the [giver | recipient] of the gift will pay it.
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