Introduction to Personal Finance Exam
Questions
Course Introduction
Introduction to Personal Finance is designed to equip students with the essential knowledge and skills to manage their financial resources effectively. The course covers a wide range of foundational topics including budgeting, saving, credit management, consumer decision-making, investing basics, insurance, taxes, and retirement planning. Through real-life scenarios and practical activities, students will learn how to develop sound financial habits, make informed choices, set financial goals, and avoid common financial pitfalls, laying the groundwork for lifelong financial well-being.
Recommended Textbook
Personal Finance 10th Edition by Jack R. Kapoor
Available Study Resources on Quizplus
19 Chapters
2307 Verified Questions
2307 Flashcards
Source URL: https://quizplus.com/study-set/2739
Page 2
Chapter 1: Personal Finance Basics and the Time Value of Money
Available Study Resources on Quizplus for this Chatper
101 Verified Questions
101 Flashcards
Source URL: https://quizplus.com/quiz/54653
Sample Questions
Q1) Which of the following goals would be the easiest to implement and measure its accomplishment?
A)"Reduce our debt payments."
B)"Save funds for an annual vacation."
C)"Save $100 a month to create a $4,000 emergency fund."
D)"Invest $2,000 a year for retirement."
E)"Increase our emergency fund."
Answer: C
Q2) Which of the following would increase the risk of a loan?
A)rising consumer prices
B)a short time to maturity
C)lower consumer prices
D)constant interest rates
E)a good credit rating
Answer: A
Q3) A decrease in the demand for a product or service may result in a decrease in wages for people producing that item.
A)True
B)False
Answer: True
To view all questions and flashcards with answers, click on the resource link above. Page 3
Chapter 2: Financial Aspects of Career Planning
Available Study Resources on Quizplus for this Chatper
89 Verified Questions
89 Flashcards
Source URL: https://quizplus.com/quiz/54652
Sample Questions
Q1) The education section of a résumé should include:
A)names of instructors.
B)course numbers.
C)individual course grades.
D)schools attendeD.
E)class activities.
Answer: D
Q2) In the career planning process,after identifying specific job opportunities,a person should:
A)assess interests,abilities,and goals.
B)develop a résumé and cover letter.
C)evaluate job offers.
D)plan for career growth.
E)evaluate the job market.
Answer: B
Q3) Current business and economic news can be an indication of future job demand. A)True
B)False
Answer: True
To view all questions and flashcards with answers, click on the resource link above.
Page 4
Chapter 3: Money Management Strategy: Financial
Statements and Budgeting
Available Study Resources on Quizplus for this Chatper
93 Verified Questions
93 Flashcards
Source URL: https://quizplus.com/quiz/54651
Sample Questions
Q1) Katherine Kocher has determined the following information about her own financial situation.Her checking account is worth $850 and her savings account is worth $1,200.She owns her own home that has a market value of $98,000.She has furniture and appliances worth $12,000 and a home computer and laptop worth $3,300.She has a car worth $12,500.She has recently purchased a 2-year certificate of deposit worth $5,500 and she has a retirement account worth $38,550.What is the value of her real estate assets?
A)$2,050
B)$98,000
C)$27,800
D)$44,050
E)$171,900
Answer: B
Q2) Which of the following would be considered a long-term liability?
A)charge account payment
B)mortgage
C)six month personal loan
D)amount due for taxes
E)amount due on a credit card
Answer: B
Page 5
To view all questions and flashcards with answers, click on the resource link above.
Chapter 4: Planning Your Tax Strategy
Available Study Resources on Quizplus for this Chatper
97 Verified Questions
97 Flashcards
Source URL: https://quizplus.com/quiz/54650
Sample Questions
Q1) Tax avoidance refers to illegal actions to reduce one's taxes.
A)True
B)False
Q2) Interest earnings of $1,600 from a taxable investment for a person in a 28 percent tax bracket would result in after-tax earnings of:
A)$1,600
B)$1,152
C)$1,100
D)$448
E)$152
Q3) A taxpayer whose spouse recently died is most likely to use the ____________ filing status.
A)single
B)married filing joint return
C)married filing separate return
D)head of household
E)qualifying widow or widower
Q4) Real-estate property taxes are a major source of revenue for local governments.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above. Page 6
Chapter 5: Financial Services: Savings Plans and Payment Accounts
Available Study Resources on Quizplus for this Chatper
89 Verified Questions
89 Flashcards
Source URL: https://quizplus.com/quiz/54649
Sample Questions
Q1) The purpose of a "special" endorsement is to:
A)cash a check.
B)deposit a check.
C)transfer a check to another person.
D)withdraw cash from your account.
E)reduce the charge for service fees.
Q2) Which type of organization does not provide home mortgages?
A)federal credit unions
B)savings and loan associations
C)employee credit unions
D)mutual savings banks
E)payroll check cashing services
Q3) A endorsement is especially useful when you are depositing checks.
A)blank
B)restrictive
C)common
D)special
E)documented
Q4) Josh earned $120 on $1500 invested in a high yield money market account.He is taxed at 28% of his earnings.What is the effective yield on his investment?
To view all questions and flashcards with answers, click on the resource link above. Page 7
Chapter 6: Introduction to Consumer Credit
Available Study Resources on Quizplus for this Chatper
170 Verified Questions
170 Flashcards
Source URL: https://quizplus.com/quiz/54648
Sample Questions
Q1) Jim Roy visits the doctor for his annual check-up which costs $85.He is billed for this at the end of the month.What type of credit did Jim use?
A)installment sales credit
B)installment cash credit
C)single lump sum credit
D)revolving credit
E)incidental credit
Q2) Which federal consumer credit law prohibits credit discrimination based on sex and marital status?
A)Truth in Lending Act
B)Fair Credit Reporting Act
C)Fair Credit Billing Act
D)Equal Credit Opportunity Act
E)Fair Debt Collection Practices Act
Q3) If you cosign and the debt is not paid off,that fact does not become a part of your credit record.
A)True
B)False
Q4) What are a few things to consider before you cosign a loan?
To view all questions and flashcards with answers, click on the resource link above. Page 8
Chapter 7: Choosing a Source of Credit: The Costs of Credit
Alternatives
Available Study Resources on Quizplus for this Chatper
129 Verified Questions
129 Flashcards
Source URL: https://quizplus.com/quiz/54647
Sample Questions
Q1) Jeff Bloom wants to have a house just like the one his parents had when he was a teenager.He finds the house he wants and gets an interest-only loan on it for the first five years.Which one of the answers best explains Jeff's spending?
A)misunderstanding or lack of communication
B)the use of money to punish
C)the expectation of instant comfort
D)keeping up with the Joneses
E)overindulgence of children
Q2) The fairest method of calculating interest is the average daily balance method. A)True
B)False
Q3) The Fair Debt Collection Practices Act regulates the ways debt collection agencies do business.
A)True
B)False
Q4) The most commonly purchased type of credit insurance is credit life insurance. A)True
B)False
Q5) What are two key concepts to keep in mind as you shop for credit?
To view all questions and flashcards with answers, click on the resource link above. Page 9
Chapter 8: Consumer Purchasing Strategies and Legal Protection
Available Study Resources on Quizplus for this Chatper
89 Verified Questions
89 Flashcards
Source URL: https://quizplus.com/quiz/54646
Sample Questions
Q1) A Whirlpool dishwasher is an example of a:
A)national brand.
B)store brand.
C)generic brand.
D)local branD.
E)regional brand.
Q2) The Sears Kenmore dishwasher is an example of a:
A)national brand.
B)store brand.
C)generic brand.
D)local branD.
E)regional brand.
Q3) Brian Williams has a piece of paper that he gives to the cashier when he purchases a particular item that allows him to get a dollar off the cost of that item.What is he most likely using?
A)coupon
B)rebate
C)warranty
D)receipt
E)promissory note
Page 10
To view all questions and flashcards with answers, click on the resource link above.
Chapter 9: The Housing Decision: Factors and Finances
Available Study Resources on Quizplus for this Chatper
91 Verified Questions
91 Flashcards
Source URL: https://quizplus.com/quiz/54645
Sample Questions
Q1) Most people select a place of residence based on available financial resources,needs,and lifestyle.
A)True
B)False
Q2) A is a building that contains exactly two separate homes.
A)mobile home
B)duplex
C)condominium
D)prefabricated home
E)cooperative
Q3) Amortization refers to changes in the monthly payment for a variable rate mortgage.
A)True
B)False
Q4) Explain negative amortization and how such a situation can occur.
Q5) What factors influence the type of housing a family will select?
Q6) Explain what amortization is and how a down payment and loan duration impact it.
Q7) An escrow account is designed to reduce the cost of a mortgage.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above. Page 11
Chapter 10: Property and Motor Vehicle Insurance
Available Study Resources on Quizplus for this Chatper
104 Verified Questions
104 Flashcards
Source URL: https://quizplus.com/quiz/54644
Sample Questions
Q1) Evan McWilliams accidentally collided with a car driven by Francis Sullivan.It was Evan's fault and Francis was seriously injured and had to spend the night in the hospital.What part of Evan's automobile insurance policy would cover Francis's injuries?
A)bodily injury liability
B)medical payments coverage
C)property damage liability
D)collision
E)comprehensive physical damage
Q2) Comprehensive coverage would cover financial losses due to:
A)injuries caused by a driver without insurance.
B)damage to your car in an accident for which you were at fault.
C)damage to your car caused by wind or hail.
D)legal action against you for an accident.
E)damage to a neighbor's tree caused by your car.
Q3) A friend wants to understand what affects the cost of auto insurance.Explain the factors used to determine the automobile insurance premiums a person pays.
Q4) Which type of automobile insurance is usually considered to be most important?
Q5) What coverages are commonly included in a homeowner's insurance policy?
To view all questions and flashcards with answers, click on the resource link above. Page 12
Chapter 11: Health, Disability, and Long-Term Care Insurance
Available Study Resources on Quizplus for this Chatper
149 Verified Questions
149 Flashcards
Source URL: https://quizplus.com/quiz/54643
Sample Questions
Q1) Disability income insurance benefits provide regular cash income lost by employees as the result of an accident or illness.
A)True
B)False
Q2) Which type of insurance provides for the partial replacement of income lost by employees as a result of an accident or illness?
A)comprehensive major medical
B)major medical expense
C)physician's expense
D)disability income
E)surgical expense
Q3) Identify the main private sources of health care insurance.
Q4) The number of Americans without basic health insurance has been decreasing since the 1980s.
A)True
B)False
Q5) Two sources of government health insurance are Medicare and Medicaid.
A)True B)False
To view all questions and flashcards with answers, click on the resource link above. Page 13
Chapter 12: Life Insurance
Available Study Resources on Quizplus for this Chatper
162 Verified Questions
162 Flashcards
Source URL: https://quizplus.com/quiz/54642
Sample Questions
Q1) Which type of life insurance policy combines term insurance and investment elements?
A)whole life
B)ordinary life
C)universal life
D)adjustable life
E)extended life
Q2) Tim Bridges has a life insurance policy where he makes payments of $265 per year until he reaches the age of 65.His policy is then 'paid up' for life.His beneficiaries will receive the face value upon his death.What type of life insurance does Tim likely have?
A)ordinary whole life
B)limited payment life
C)variable life
D)adjustable life
E)universal life
Q3) Term insurance continues for the entire term even if you stop paying the premiums. A)True
B)False
To view all questions and flashcards with answers, click on the resource link above. Page 14
Chapter 13: Investing Fundamentals
Available Study Resources on Quizplus for this Chatper
115 Verified Questions
115 Flashcards
Source URL: https://quizplus.com/quiz/54641
Sample Questions
Q1) All of the following statements are considered to be good advice for a potential investor starting an investment program except:
A)Work to balance your budget.
B)Increase credit purchases to conserve cash.
C)Establish specific and measurable investment goals.
D)Start an emergency funD.
E)Establish a line of credit.
Q2) Once you have made a decision to buy an investment,there is no need for continued evaluation.
A)True
B)False
Q3) There is no relationship between risk and safety.
A)True
B)False
Q4) Which type of risk affects only a specific company or a specific industry?
A)interest rate
B)systematic
C)unsystematic
D)economic
E)inflation
To view all questions and flashcards with answers, click on the resource link above. Page 15
Chapter 14: Investing in Stocks
Available Study Resources on Quizplus for this Chatper
133 Verified Questions
133 Flashcards
Source URL: https://quizplus.com/quiz/54640
Sample Questions
Q1) Convertible preferred stock may be exchanged,at the corporation's option,for a specified number of shares of common stock.
A)True
B)False
Q2) Common stock dividends are paid out of profits and:
A)must be approved by the firm's board of directors.
B)are guaranteed to be paid quarterly.
C)are paid prior to the firm's taxes.
D)usually paid semi-annually.
E)equal 100 percent of the firm's annual earnings.
Q3) Stocks issued by large corporations in mature industries often have high PE ratios.
A)True
B)False
Q4) Preferred stock is often referred to as a middle investment as it has features similar to both common stock and corporate bonds.
A)True
B)False
Q5) What is the primary difference between common stock and preferred stock?
To view all questions and flashcards with answers, click on the resource link above. Page 16
Chapter 15: Investing in Bonds
Available Study Resources on Quizplus for this Chatper
123 Verified Questions
123 Flashcards
Source URL: https://quizplus.com/quiz/54639
Sample Questions
Q1) The current yield for a bond is determined by dividing the annual income amount by the current market value.
A)True
B)False
Q2) The highest bond rating issued by Moody's is:
A)AAA.
B)Aaa.
C)A +.
D)BB.
E)AA.
Q3) A registered bond is a bond whose ownership is registered in the owner's name by the issuing company.
A)True
B)False
Q4) Which one of the following bonds would likely have the lowest risk?
A)Treasury bill
B)municipal bond
C)corporate bond
D)government agency bond
E)junk bond
Page 17
To view all questions and flashcards with answers, click on the resource link above.
Chapter 16: Investing in Mutual Funds
Available Study Resources on Quizplus for this Chatper
133 Verified Questions
133 Flashcards
Source URL: https://quizplus.com/quiz/54638
Sample Questions
Q1) Sloan Richards is buying shares in a mutual fund that invests in companies that have a market capitalization of less than $2 billion.What type of mutual fund is this?
A)socially responsible fund
B)sector fund
C)small-cap fund
D)index fund
E)growth fund
Q2) The New American Enterprise Mutual Fund's portfolio is valued at $120 million.The fund has liabilities of $4 million,and the investment company sponsoring the fund has issued 5,800,000 shares.What is the fund's net asset value?
A)$120
B)$58
C)$40
D)$30
E)$20
Q3) In a newspaper quotation,the letter "p" means a 12b-1 distribution fee is charged.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above. Page 18
Chapter 17: Investing in Real Estate and Other Investment
Alternatives
Available Study Resources on Quizplus for this Chatper
134 Verified Questions
134 Flashcards
Source URL: https://quizplus.com/quiz/54637
Sample Questions
Q1) Unlike stocks and bonds,precious metals sitting in vaults earn no income.
A)True
B)False
Q2) There are three types of REITs: equity REITs,mortgage REITs,and hybrid REITs.
A)True
B)False
Q3) Limited partnerships and syndicates are examples of direct real estate investment.
A)True
B)False
Q4) One of the advantages of being a limited partner in a real estate investment venture is that you have ____________ liability.
A)no financial
B)unlimited financial
C)product
D)limited financial
E)implied
Q5) Ginnie Maes are backed by the full faith and credit of the Federal Government.
A)True
B)False
Page 19
To view all questions and flashcards with answers, click on the resource link above.
Chapter 18: Starting Early: Retirement Planning
Available Study Resources on Quizplus for this Chatper
165 Verified Questions
165 Flashcards
Source URL: https://quizplus.com/quiz/54636
Sample
Questions
Q1) Which statement is most likely correct about retirement planning?
A)Social Security will cover most of your expenses.
B)Your employer's pension combined with your Social Security will cover your retirement expenses.
C)Most retirees don't need to worry about inflation.
D)Your pension may remain constant even in an inflationary environment.
E)Your living costs will remain constant once you retirE.
Q2) Your first step in retirement planning is to:
A)estimate your spending needs.
B)analyze your current assets and liabilities.
C)adjust your spending needs for inflation.
D)evaluate your planned retirement income.
E)determine if you'll have to work during retirement.
Q3) Which one of the following expenditures for retirees is most likely to increase?
A)health care
B)federal income taxes
C)clothing expenses
D)work-related expenses
E)state income taxes
Q4) How can retirees avoid housing traps?
To view all questions and flashcards with answers, click on the resource link above. Page 20
Chapter 19: Estate Planning
Available Study Resources on Quizplus for this Chatper
141 Verified Questions
141 Flashcards
Source URL: https://quizplus.com/quiz/54635
Sample Questions
Q1) A credit-shelter trust is perhaps the most common estate-planning trust.
A)True
B)False
Q2) A living will provides for your wishes to be followed if you become so physically or mentally disabled that you are unable to act on your own behalf.
A)True
B)False
Q3) If you establish a(n)____________ trust,you retain the right to end the trust or change its terms.
A)irrevocable
B)revocable
C)living
D)self-declaration
E)testamentary
Q4) With a marital-deduction trust you can leave your spouse any money that doesn't go into a credit-shelter trust.
A)True
B)False
Q5) What are some common reasons for setting up a trust?
To view all questions and flashcards with answers, click on the resource link above. Page 21