Financial Management for Individuals Review Questions
Course Introduction
Financial Management for Individuals provides students with essential knowledge and skills to effectively manage personal finances and make informed financial decisions. The course covers topics such as budgeting, saving, credit management, investment strategies, retirement planning, and risk management. Students will learn how to evaluate financial options, interpret financial statements, and apply principles of financial planning to real-life scenarios. By the end of the course, participants will be equipped to create comprehensive financial plans that support long-term financial stability and personal goals.
Recommended Textbook
PFIN 6 6th Edition by Randall Billingsley
Available Study Resources on Quizplus
15 Chapters
1162 Verified Questions
1162 Flashcards
Source URL: https://quizplus.com/study-set/2610
Page 2
Chapter 1: Understanding the Financial Planning Process
Available Study Resources on Quizplus for this Chatper
110 Verified Questions
110 Flashcards
Source URL: https://quizplus.com/quiz/51975
Sample Questions
Q1) The best way to resolve money disputes is to:
A)never discuss money matters with family and ensure that only one person in the family makes financial decisions.
B)communicate consistently about money matters with family and be willing to compromise.
C)make financial decisions independently and ensure that individuals do not interfere in other family members' financial matters.
D)adopt a third party's opinion,who is not a part of the family,to set financial goals.
E)always handle the money disputes of the family according to the local state law.
Answer: B
Q2) Marital status affects the income level of individuals.
A)True
B)False
Answer: True
To view all questions and flashcards with answers, click on the resource link above. Page 3
Chapter 2: Using Financial Statements and Budgets
Available Study Resources on Quizplus for this Chatper
102 Verified Questions
102 Flashcards
Source URL: https://quizplus.com/quiz/51976
Sample Questions
Q1) If your liquid assets equal $15,000 and your current debts equal $50,000,your liquidity ratio is:
A)30%.
B)70%.
C)143%.
D)233%.
E)333%.
Answer: A
Q2) Your car has a market value of $4,000,while the balance of the loan against it is now $2,500.Your ownership interest in the car is ____________.
A)$2,500
B)$4,000
C)$6,500
D)$1,500
Answer: D
Q3) Financial plans provide direction to annual budgets.
A)True
B)False
Answer: True
To view all questions and flashcards with answers, click on the resource link above.
Page 4
Chapter 3: Preparing Your Taxes
Available Study Resources on Quizplus for this Chatper
81 Verified Questions
81 Flashcards
Source URL: https://quizplus.com/quiz/51977
Sample Questions
Q1) Mr.and Mrs.McMurray have three children,aged 6,12,and 18,for whom they paid childcare expenses of $6,000 in 2015.The McMurrays' tax liability calculated as per the tax schedule is $10,000.The McMurrays' tax liability is _____.
A)$8,000
B)$8,500
C)$8,800
D)$13,190
E)$10,000
Answer: A
Q2) Income shifting refers to the process of transferring income from the taxpayer to the IRS.
A)True
B)False Answer: False
Q3) If you are married,you can legally file as a single taxpayer.
A)True
B)False
Answer: False
To view all questions and flashcards with answers, click on the resource link above.
5
Chapter 4: Managing Your Cash and Savings
Available Study Resources on Quizplus for this Chatper
83 Verified Questions
83 Flashcards
Source URL: https://quizplus.com/quiz/51978
Sample Questions
Q1) Mike has $450 in his checking account when his ATM card and PIN are stolen.If Mike notifies his bank within two business days after he discovers the card missing,his loss is limited to _____.
A)$0
B)$25
C)$50
D)$400
E)$500
Q2) People who do not have checking accounts often use ____________.
A)a cashier's check
B)overdraft protection
C)a debit card
D)a checkbook ledger
Q3) The minimum denomination of T-bills is:
A)$100.
B)$500.
C)$1,000.
D)$2,000.
E)$2,500.
To view all questions and flashcards with answers, click on the resource link above.
Page 6
Chapter 5: Making Automobile and Housing Decisions
Available Study Resources on Quizplus for this Chatper
72 Verified Questions
72 Flashcards
Source URL: https://quizplus.com/quiz/51979
Sample Questions
Q1) You made a $900 mortgage payment.The interest of $925 on the mortgage for this month leads to an increase in the principal balance.You have ____________.
A)experienced a negative amortization
B)signed up for a conventional mortgage
C)refinanced your loan
D)taken a fixed-rate mortgage
Q2) The real estate agent's commission is generally paid by ____________.
A)the seller
B)the buyer
C)the mortgage bank
D)the local multiple listing service provider
Q3) The price of the car you are leasing is called the:
A)money factor.
B)capitalized cost.
C)residual value.
D)purchase option.
E)capital cost reduction.
Q4) The job of a mortgage banker is to locate conventional loans for clients.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above. Page 7
Chapter 6: Using Credit
Available Study Resources on Quizplus for this Chatper
113 Verified Questions
113 Flashcards
Source URL: https://quizplus.com/quiz/51980
Sample Questions
Q1) A person who pays off the total outstanding balance on his credit card monthly would prefer a credit card with:
A)a low required minimum payment percentage.
B)a high interest rate.
C)high over-the-limit fees.
D)no grace period.
E)no annual fee.
Q2) The majority of persons filing for bankruptcy chooseChapter 7 of the U.S.Bankruptcy Code.
A)True
B)False
Q3) Always paying cash helps in establishing a high level of creditworthiness.
A)True
B)False
Q4) The amount of finance charges one pays on a credit card depends only on the annual percentage rate (APR)and the grace period charges.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above.
Page 8
Chapter 7: Using Consumer Loans
Available Study Resources on Quizplus for this Chatper
85 Verified Questions
85 Flashcards
Source URL: https://quizplus.com/quiz/51981
Sample Questions
Q1) Mason Corporation borrows funds for the expansion of its business.The loan is secured with the office building.Therefore,the office building serves as _____ for the loan.
A)a liability
B)a collateral
C)a debt
D)an insurance
E)a corporate deposit
Q2) Rebates are always more cost effective than the 0 percent annual percentage rate (APR)loans offered on automobile loans.
A)True
B)False
Q3) If you don't have much down payment money,a ____________ can effectively act as the cheapest source of down payment.
A)rebate
B)percent APR loan
C)credit card
D)commercial loan
To view all questions and flashcards with answers, click on the resource link above. Page 9
Chapter 8: Insuring Your Life
Available Study Resources on Quizplus for this Chatper
85 Verified Questions
85 Flashcards
Source URL: https://quizplus.com/quiz/51982
Sample Questions
Q1) Risk avoidance involves asking an insurance company to take over the risk for a small payment (the premium).
A)True
B)False
Q2) Life insurance proceeds paid to your heirs are not usually subject to state or federal income taxes.
A)True B)False
Q3) Group life insurance is:
A)a term policy designed to pay off the mortgage balance in the event of the borrower's death.
B)an insurance that is sold in conjunction with the sale of a group of assets.
C)an insurance in which benefits are a function of the returns being generated on the investments selected by the policyholder.
D)an insurance that provides a master policy for a group.
E)an insurance that issues many master policies for an insured.
Q4) The need for life insurance increases with children.
A)True B)False
To view all questions and flashcards with answers, click on the resource link above. Page 10
Chapter 9: Insuring Your Health
Available Study Resources on Quizplus for this Chatper
69 Verified Questions
69 Flashcards
Source URL: https://quizplus.com/quiz/51983
Sample Questions
Q1) Disability insurance is available only when someone is completely incapable of returning to work during his or her lifetime.
A)True
B)False
Q2) Blue Cross provides hospital coverage and Blue Shield provides prescription pharmacy coverage.
A)True
B)False
Q3) An elimination period is the number of days that must pass before disability policies pay the benefits.
A)True
B)False
Q4) The ACA's provisions relating to long-term care include the Community Living Assistance Services and Support Program (CLASS),which will be administered by
A)the U.S.Department of Health and Human Services
B)private insurance providers
C)the Social Security administration
D)the government
To view all questions and flashcards with answers, click on the resource link above. Page 11
Chapter 10: Protecting Your Property
Available Study Resources on Quizplus for this Chatper
48 Verified Questions
48 Flashcards
Source URL: https://quizplus.com/quiz/51984
Sample Questions
Q1) An insurance company assigns more complex loss cases to a __________.
A)captive insurance agent
B)claims adjustor
C)Chartered Property and Casualty Underwriter
D)Certified Insurance Counselor
Q2) The liability coverage under a personal automobile policy is provided to:
A)the insured for damage.
B)the family members of the insured.
C)the holder of an auto loan.
D)the lawyer needed to defend criminal charges.
E)the non-family members involved in the accident.
Q3) Never discuss liability at the scene of an accident,or with anyone other than the police and the insurance company.
A)True
B)False
Q4) Insurance policies provide the opportunity for claims arbitration to settle any disputed liability claims.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above. Page 12
Chapter 11: Investment Planning
Available Study Resources on Quizplus for this Chatper
79 Verified Questions
79 Flashcards
Source URL: https://quizplus.com/quiz/51985
Sample Questions
Q1) Which of the following best describes portfolio management?
A)The management of a marketplace in which stocks,bonds,and other financial instruments are traded
B)A procedure used to settle disputes between a brokerage firm and its clients,which makes a final and usually binding decision on the matter
C)The management of an agency of the federal government that regulates the disclosure of information about securities and generally oversees the operation of the securities exchanges and markets
D)The process of creation of a document that is made available to prospective security buyers that describes the firm and a new security issue
E)The buying,selling,and holding of various securities in order to meet a set of predetermined investment needs and objectives
Q2) Owning common stock represents a debt investment.
A)True
B)False
Q3) Reallocation of the assets in a portfolio is called rebalancing.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above.
13
Chapter 12: Investing in Stocks and Bonds
Available Study Resources on Quizplus for this Chatper
86 Verified Questions
86 Flashcards
Source URL: https://quizplus.com/quiz/51986
Sample Questions
Q1) Compound interest is a very important concept when evaluating the return on an investment you plan to hold for a long time.
A)True
B)False
Q2) The advantages of a dividend reinvestment plan (DRP)may include:
A)stock sold at a discount.
B)guaranteed rate of return.
C)tax advantages.
D)convertibility option.
E)repayment of the principal.
Q3) The returns you expect from securities are income and growth.
A)True
B)False
Q4) To most stockholders,the main advantages of common stock investments are:
A)attractive returns and active trading.
B)guaranteed returns and voting rights.
C)high interest payment and active trading.
D)high risk and guaranteed returns.
E)low risk and guaranteed returns.
To view all questions and flashcards with answers, click on the resource link above. Page 14
Chapter 13: Investing in Mutual Funds, ETFS and Real Estate
Available Study Resources on Quizplus for this Chatper
48 Verified Questions
48 Flashcards
Source URL: https://quizplus.com/quiz/51987
Sample Questions
Q1) An investor with a small amount of money should stick to using load funds instead of no-load funds.
A)True
B)False
Q2) Mutual funds and exchange traded funds (ETFs)always provide professional investment management.
A)True B)False
Q3) A major benefit of mutual funds to small investors is diversification.
A)True B)False
Q4) For tax purposes,real estate is considered an active investment.
A)True
B)False
Q5) The actual ownership of a mutual fund is in the hands of the __________. A)management company
B)custodians
C)shareholders
D)distributors
To view all questions and flashcards with answers, click on the resource link above. Page 15
Chapter 14: Planning for Retirement
Available Study Resources on Quizplus for this Chatper
48 Verified Questions
48 Flashcards
Source URL: https://quizplus.com/quiz/51988
Sample Questions
Q1) The third step in retirement planning is to formulate an investment program.
A)True
B)False
Q2) Your Social Security contribution depends on your current income and retirement income goal.
A)True
B)False
Q3) Contributions are made in after-tax dollars to __________.
A)traditional 401(k)plans
B)traditional IRAs plans
C)SEP plans
D)Roth 401(k)plans
Q4) If an annuity plan is designed so that the monthly payment is adjusted by the actual investment experience of the insurer,it is:
A)a guaranteed-minimum annuity.
B)an equity annuity.
C)a variable annuity.
D)an uncertain annuity.
E)a temporary annuity.
To view all questions and flashcards with answers, click on the resource link above. Page 16
Chapter 15: Preserving Your Estate
Available Study Resources on Quizplus for this Chatper
53 Verified Questions
53 Flashcards
Source URL: https://quizplus.com/quiz/51989
Sample Questions
Q1) You have a spouse,two children,one grandchild,and a living father.If you died without a valid will,the person(s)most likely to receive the proceeds of your estate would be your:
A)grandchildren.
B)spouse.
C)parents.
D)brothers.
E)friends.
Q2) The transfer of an estate (after death)by an individual to the _____ of the individual will result in the most favorable tax treatments.
A)children
B)spouse
C)parents
D)employer
E)siblings
Q3) A credit shelter trust is used to save estate tax by using the unused unified transfer tax (UTT)credit.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above.
17