Introduction to Financial Planning Question
Bank
Course Introduction
Introduction to Financial Planning provides students with a foundational understanding of the principles and practices involved in managing personal finances and planning for future financial security. The course covers essential topics such as budgeting, saving, investing, credit management, insurance, retirement planning, and tax considerations. Through real-world examples and practical exercises, students will develop the skills needed to create effective financial plans, set achievable financial goals, and make informed decisions to achieve long-term financial well-being. This course serves as a valuable resource for anyone interested in gaining control over their financial future and understanding the basics of financial planning.
Recommended Textbook
Personal Finance 13th Edition by E. Thomas Garman
Available Study Resources on Quizplus
17 Chapters
3061 Verified Questions
3061 Flashcards
Source URL: https://quizplus.com/study-set/1328 Page 2
Chapter 1: Understanding Personal Finance
Available Study Resources on Quizplus for this Chatper
148 Verified Questions
148 Flashcards
Source URL: https://quizplus.com/quiz/26518
Sample Questions
Q1) Compound interest will produce larger investment values than simple interest.
A)True
B)False
Answer: True
Q2) Present value is the current value of an asset (or stream of assets) that will be received in the future.
A)True
B)False
Answer: True
Q3) Marginal cost is the incremental cost of one more incremental unit of something.
A)True
B)False
Answer: True
Q4) Retirement planning is a process that should begin three to five years before retirement.
A)True
B)False
Answer: False
To view all questions and flashcards with answers, click on the resource link above.
Page 3
Chapter 2: Career Planning
Available Study Resources on Quizplus for this Chatper
76 Verified Questions
76 Flashcards
Source URL: https://quizplus.com/quiz/26519
Sample Questions
Q1) Weighing the demands of particular jobs with your social and cultural preferences involves making lifestyle trade-offs.
A)True
B)False
Answer: True
Q2) The law requires employers to do all of the following after hiring a new employee except
A)provide unemployment insurance.
B)pay Social Security taxes to the federal government.
C)pay all of the employee's health care expenses.
D)provide workers' compensation benefits to employees injured on the job.
Answer: C
Q3) In most cases,you should not turn down a job offer without taking a day or two to think it over.
A)True
B)False
Answer: True
To view all questions and flashcards with answers, click on the resource link above.
Page 4
Chapter 3: Financial Statements,tools,and Budgets
Available Study Resources on Quizplus for this Chatper
150 Verified Questions
150 Flashcards
Source URL: https://quizplus.com/quiz/26520
Sample Questions
Q1) The debt-to-income ratio provides a view of total debt burden of an individual or family by comparing the dollars spent on gross annual debt repayments with gross annual income.
A)True
B)False
Answer: True
Q2) A successful financial plan includes
A)specified values that underlie the plan.
B)explicitly stated financial goals.
C)logical and consistent financial strategies.
D)all of these.
Answer: D
Q3) Which of the following would be included in the category of assets known as monetary assets?
A)Money market accounts
B)Stocks
C)Bonds
D)Real estate
Answer: A
To view all questions and flashcards with answers, click on the resource link above.
Page 5
Chapter 4: Managing Income Taxes
Available Study Resources on Quizplus for this Chatper
201 Verified Questions
201 Flashcards
Source URL: https://quizplus.com/quiz/26521
Sample Questions
Q1) Most tax shelters are methods permitting an investor to avoid taxes forever.
A)True
B)False
Q2) The IRS says you must do what a "reasonable business person" would do to make a profit when running your own business.
A)True
B)False
Q3) Sandra Maxwell is a full-time student and her husband,Joel,is employed,so they take their young son,Sam,to a child care center during the day.They qualify for a 25 percent dependent care tax credit,and they are in the 15 percent marginal tax bracket.If the annual cost of the child care is $6,200,how much will it save Sandra and Joel on their income taxes?
A)$6,200
B)$1,550
C)$930
D)$232.50
Q4) The most commonly used defined-contribution plan is the Roth IRA.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above. Page 6
Chapter 5: Managing Checking and Savings Accounts
Available Study Resources on Quizplus for this Chatper
181 Verified Questions
181 Flashcards
Source URL: https://quizplus.com/quiz/26522
Sample Questions
Q1) To be legally responsible for only the first $50 of unauthorized use,one must report an ATM card missing within two days after the loss or theft of the card.
A)True
B)False
Q2) The Federal Deposit Insurance Corporation (FDIC) insures accounts in A)commercial banks.
B)credit unions.
C)brokerage companies.
D)commercial banks and credit unions.
Q3) One should accumulate enough savings to cover living expenses for six to nine months.
A)True
B)False
Q4) A share draft account is the credit union version of a NOW account.
A)True
B)False
Q5) Commercial banks typically offer the widest variety of financial services.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above. Page 7
Chapter 6: Building and Maintaining Good Credit
Available Study Resources on Quizplus for this Chatper
136 Verified Questions
136 Flashcards
Source URL: https://quizplus.com/quiz/26523
Sample Questions
Q1) Credit bureaus compile information from A)banks.
B)creditors.
C)court records.
D)All of these.
Q2) Perhaps the greatest disadvantage of credit use is the A)loss of financial flexibility in personal money management.
B)risk of overspending.
C)reduction in future buying power due to finance charges.
D)possibility of getting a poor credit reputation.
Q3) You should review your credit bureau reports at least once every three years. A)True
B)False
Q4) The contract for a loan is called the A)promissory note.
B)credit agreement.
C)credit application.
D)credit report.
To view all questions and flashcards with answers, click on the resource link above. Page 8
Chapter 7: Credit Cards and Consumer Loans
Available Study Resources on Quizplus for this Chatper
166 Verified Questions
166 Flashcards
Source URL: https://quizplus.com/quiz/26524
Sample Questions
Q1) When a person makes a purchase on credit with no cash passing between the borrower and the lender,this is called a cash loan.
A)True
B)False
Q2) Federal law states that bills must be mailed to cardholders at least ____ days before payments are due.
A)7
B)10
C)14
D)21
Q3) The only way to obtain a secured loan is to put up collateral.
A)True
B)False
Q4) Which of the following should not be done when you find an error on your credit card statement?
A)Pay the remaining amount owed in full to isolate a disputed item.
B)Withhold payment for the disputed item(s).
C)Send a written notice of the error to the credit card issuer.
D)Send all original documentation to the credit card issuer.
To view all questions and flashcards with answers, click on the resource link above. Page 9
Chapter 8: Vehicles and Other Major Purchases
Available Study Resources on Quizplus for this Chatper
145 Verified Questions
145 Flashcards
Source URL: https://quizplus.com/quiz/26525
Sample Questions
Q1) Negotiating becomes easier for the buyer when there are multiple variables such as price,trade-in product and financing options in the overall deal.
A)True
B)False
Q2) When negotiating to purchase a vehicle,besides the price,what other variables should be considered?
A)Trade-in value
B)Prices of options
C)Interest rate
D)All of these
Q3) Dividing the price of a product by the number of times it will likely be used provides its ______ and provides a way to compare among competing purchase options.
A)item price
B)cost-per-use
C)bottom line
D)unit-price.
To view all questions and flashcards with answers, click on the resource link above. Page 10
Chapter 9: Obtaining Affordable Housing
Available Study Resources on Quizplus for this Chatper
217 Verified Questions
217 Flashcards
Source URL: https://quizplus.com/quiz/26526
Sample Questions
Q1) Community and housing development rules that govern such things as minimum lot size,the outside appearance and landscaping of the property,allowable secondary buildings,parking of vehicles,and other aspects of the use and appearance of the property are called
A)title limits.
B)usage limits.
C)deed restrictions.
D)title restrictions.
Q2) A price-to-rent ratio above 15 can mean that the prices for homes in a community are inflated.
A)True
B)False
Q3) If the lender requires an 85 percent loan-to-value ratio,the borrower will have to make a ____ percent down payment.
A)5
B)15
C)20
D)85
To view all questions and flashcards with answers, click on the resource link above.
11
Chapter 10: Managing Property and Liability Risk
Available Study Resources on Quizplus for this Chatper
209 Verified Questions
209 Flashcards
Source URL: https://quizplus.com/quiz/26527
Sample Questions
Q1) Misty and her passenger,Angela,were involved in a one-car accident for which Misty was not at fault.Misty suffered bodily injuries of $5,500,while Angela's bodily injuries were $35,000.If Misty's auto insurance policy includes 20/40/15 bodily injury liability and $10,000 medical payments insurance,how much will the insurance policy pay for Misty and Angela's injuries?
A)$5,500 for Misty and $10,000 for Angela
B)$5,500 for Misty and $30,000 for Angela
C)$0 for Misty and $30,000 for Angela
D)$0 for Misty and $35,000 for Angela
Q2) The cost of a $1 million professional liability policy would vary slightly regardless of the profession of the policy buyer.
A)True
B)False
Q3) ____ is not covered under your automobile bodily injury and property damage liability coverage (Section A).
A)Damage to property of others
B)Bodily injuries to passengers in your vehicle
C)Property damage to your vehicle
D)Bodily injuries of pedestrians hit by your vehicle
To view all questions and flashcards with answers, click on the resource link above.
Page 12
Chapter 11: Managing Health Expenses
Available Study Resources on Quizplus for this Chatper
136 Verified Questions
136 Flashcards
Source URL: https://quizplus.com/quiz/26528
Sample Questions
Q1) Medicare Part B covers all of the following except
A)outpatient care.
B)doctor office visits
C)chiropractic services.
D)hospitalization
Q2) Your health insurance requires that you pay $50 each time you visit the doctor's office and $15 for each prescription drug.This is an example of A)a copayment.
B)a deductible.
C)coinsurance.
D)policy limits.
Q3) Disability income insurance plans may cover long-term but not short-term disability.
A)True
B)False
Q4) The greater your age when a disability income policy is purchased,the more you might need inflation protection.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above. Page 13
Chapter 12: Life Insurance Planning
Available Study Resources on Quizplus for this Chatper
215 Verified Questions
215 Flashcards
Source URL: https://quizplus.com/quiz/26529
Sample Questions
Q1) The most important feature of a life insurance company is its A)service.
B)cost comparison index number.
C)ability to pay its obligations.
D)insurance agents.
Q2) Cash-value life insurance is sometimes called permanent insurance.
A)True
B)False
Q3) Married couples should integrate their life insurance plans and combine their life insurance needs in one policy on the life of one of the spouses.
A)True
B)False
Q4) Ratings of the financial strengths of insurance companies are available from A)Standard & Poors.
B)FDIC.
C)A.M. Best Company.
D)both Standard & Poors and A.M. Best Company.
Q5) Life insurance proceeds are nontaxable to the beneficiary. A)True
B)False
To view all questions and flashcards with answers, click on the resource link above. Page 14
Chapter 13: Investment Fundamentals
Available Study Resources on Quizplus for this Chatper
172 Verified Questions
172 Flashcards
Source URL: https://quizplus.com/quiz/26530
Sample Questions
Q1) ____ is an example of an ownership investment.
A)Treasury Bills
B)Mortgage-backed bonds
C)Common corporate stock
D)Corporate bonds
Q2) Which of the following arises when investors decide to copy the observed decisions of other investors or movements in the markets rather than follow their own beliefs and information.
A)herd-behavior.
B)market timing.
C)market seeking.
D)passive investing.
Q3) Investing goes beyond saving in that it
A)requires that less be spent than you earn.
B)involves increased risk.
C)ignores current income.
D)is something only few people should do.
Q4) Capital gains (losses) are not realized until one actually sells the investment.
A)True
B)False
Page 15
To view all questions and flashcards with answers, click on the resource link above.
Chapter 14: Investing in Stocks and Bonds
Available Study Resources on Quizplus for this Chatper
352 Verified Questions
352 Flashcards
Source URL: https://quizplus.com/quiz/26531
Sample Questions
Q1) The yield to maturity is a more accurate measure of effective return on a bond investment than current yield.
A)True
B)False
Q2) The Last column of the stock quotes lists the price of the last trade of the quarter.
A)True
B)False
Q3) The potential return for any investment over a period of years can be determined by adding anticipated income to the future value of the investment minus its original cost.
A)True
B)False
Q4) What type of investor believes that the market isn't always efficient and that it is possible to find companies that are trading for less than they are worth?
A)Fundamental investor
B)Growth investor
C)Conservative investor
D)Value investor
To view all questions and flashcards with answers, click on the resource link above. Page 16
Chapter 15: Mutual Funds and Exchange Traded Funds
Available Study Resources on Quizplus for this Chatper
176 Verified Questions
176 Flashcards
Source URL: https://quizplus.com/quiz/26532
Sample Questions
Q1) Volatility is a mutual fund's tendency to rise and fall in price over a period of time.
A)True
B)False
Q2) Mutual fund investors must pay federal income taxes on
A)ordinary income dividend distributions.
B)capital gains distributions.
C)capital gains from selling their shares.
D)(all of these)
Q3) A primary goal of a balanced fund is to earn a well-balanced return of income and long-term capital gains.
A)True
B)False
Q4) In general,____ charges are more costly in the short run,and ____ charges are more costly in the long run.
A)front-end; up-front
B)front-end; annual
C)annual; up-front
D)annual; front-end
To view all questions and flashcards with answers, click on the resource link above.
Chapter 16: Real Estate and High-Risk Investments
Available Study Resources on Quizplus for this Chatper
112 Verified Questions
112 Flashcards
Source URL: https://quizplus.com/quiz/26533
Sample Questions
Q1) A hedge fund
A)can profit in times of market volatility.
B)can profit in a falling market.
C)is subject to the regulations of the Securities and Exchange Commission.
D)can profit in times of market volatility as well as in a falling market.
Q2) Timesharing should be considered vacation plans rather than real estate investments.
A)True
B)False
Q3) Puts allow the holder of the contract to sell an asset at a specific striking price for a certain time period before the expiration date.
A)True
B)False
Q4) Futures contracts usually focus on all of the following except A)soybeans.
B)orange juice.
C)rubber.
D)coffee.
To view all questions and flashcards with answers, click on the resource link above. Page 18
Chapter 17: Retirement and Estate Planning
Available Study Resources on Quizplus for this Chatper
269 Verified Questions
269 Flashcards
Source URL: https://quizplus.com/quiz/26534
Sample Questions
Q1) You should not consider investing in an annuity until all other tax-sheltered vehicles to save and invest for retirement have been maximized.
A)True
B)False
Q2) Which of the following statements about survivor's and disability benefits under defined-benefit plans is false?
A)Most employer-sponsored retirement plans provide survivor's benefits.
B)If spousal benefits are waived, the worker's retirement benefit will be higher.
C)The covered worker can cancel spousal benefits only if the spouse consents in writing.
D)Disability and survivor's benefits are typically the same amount as retirement benefits.
Q3) Social Security taxes withheld from an employee's paycheck are commonly called FICA taxes.
A)True B)False
To view all questions and flashcards with answers, click on the resource link above. Page 19