Lifetime Financial Management Test Questions
Course Introduction
Lifetime Financial Management explores the principles and strategies essential for achieving long-term financial well-being. The course covers topics such as budgeting, saving, investing, risk management, retirement planning, and estate planning, with an emphasis on decision-making at various life stages. Students will learn to set realistic financial goals, understand credit and debt, evaluate investment options, and plan for major life events. Through case studies and practical exercises, the course equips students with the knowledge and skills necessary to develop comprehensive financial plans that adapt to changing personal and economic circumstances throughout ones lifetime.
Recommended Textbook
Personal Finance 12th Edition by E.
Thomas Garman
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17 Chapters
3013 Verified Questions
3013 Flashcards
Source URL: https://quizplus.com/study-set/3300 Page 2
Chapter 1: Understanding Personal Finance
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141 Verified Questions
141 Flashcards
Source URL: https://quizplus.com/quiz/65489
Sample Questions
Q1) How much is Jeremiah and Sara's real income after the $3,000 increase in income?
A) $63,000
B) $61,765
C) $60,000
D) $58,824
Answer: B
Q2) Bill and Alma are shopping for their first home.They have found two houses that are nearly identical except for their locations.One house costs $250,000 and is 15 miles from their places of employment.The second house costs $275,000,but it is within 5 miles of where they both work.Now Bill and Alma are trying to decide if living 10 miles closer to their workplaces is worth the extra $25,000 in the cost of the house.Which decision-making concept are they using?
A) Opportunity cost
B) Marginal analysis
C) Time value of money
D) Total utility
Answer: B
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Chapter 2: Career Planning
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76 Verified Questions
76 Flashcards
Source URL: https://quizplus.com/quiz/65488
Sample Questions
Q1) Most employment agencies earn their fees from the individual searching for a job.
A)True
B)False Answer: False
Q2) Salaried employees are paid overtime,and the majority of college graduates have salaried positions.
A)True
B)False Answer: False
Q3) Most of the contacts you make through professional networking will be in a position to offer you a job.
A)True
B)False Answer: False
Q4) Failure to obtain a job offer after an interview is most likely due to some failing during the interview.
A)True
B)False Answer: False
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Chapter 3: Financial Statements,tools,and Budgets
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151 Verified Questions
151 Flashcards
Source URL: https://quizplus.com/quiz/65487
Sample Questions
Q1) Your goal in financial planning is to manage your income and wealth in such a way that your goals are met in a suitable manner.
A)True
B)False
Answer: True
Q2) A family with two income earners will always need a greater amount of cash reserves than a family with one earner.
A)True
B)False Answer: False
Q3) Monetary assets include cash and near-cash items that can be readily converted to cash.
A)True
B)False Answer: True
Q4) Specific financial goals drive the creation of budgets. A)True
B)False Answer: True
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Chapter 4: Managing Income Taxes
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196 Verified Questions
196 Flashcards
Source URL: https://quizplus.com/quiz/65486
Sample Questions
Q1) The money you receive back because you have overpaid your taxes is called a tax return.
A)True
B)False
Q2) Having your employer withhold more in estimated taxes than the likely tax liability ultimately due the government is a recommended technique for saving money.
A)True
B)False
Q3) The tax break for losses from passive investments begins to phase out for taxpayers higher incomes.
A)True
B)False
Q4) State sales tax is an example of a regressive tax.
A)True
B)False
Q5) Tax deferral with a traditional IRA allows investment income to grow without being taxed until it is withdrawn.
A)True
B)False
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Chapter 5: Managing Checking and Savings Accounts
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181 Verified Questions
181 Flashcards
Source URL: https://quizplus.com/quiz/65485
Sample Questions
Q1) An individual checking or savings account can be set up to go automatically to another person when the depositor dies if it is set up as a(n)
A) payable at death account.
B) obituarial account.
C) estate account.
D) joint tenancy account.
Q2) Funds on deposit in a savings account are considered demand deposits.
A)True
B)False
Q3) Special concerns for blended families include
A) determining who assumes financial responsibility for biological offspring and stepchildren.
B) handling resentment over alimony and child-support payments.
C) managing unequal assets,incomes,responsibilities,and debts.
D) all of these.
Q4) An asset management account is a multiple-purpose,coordinated package that provides a wide variety of financial services.
A)True
B)False
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Chapter 6: Building and Maintaining Good Credit
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143 Verified Questions
143 Flashcards
Source URL: https://quizplus.com/quiz/65484
Sample Questions
Q1) The higher your credit score the more you will pay for credit.
A)True
B)False
Q2) A debt-to-equity method provides a quick idea of one's financial solvency.The larger the ratio,the riskier the likelihood of repayment.A ratio in excess of 0.25 is considered high.
A)True
B)False
Q3) The percentage of your total credit limits that is actually owed is called your
A) debt limit.
B) credit availability ratio.
C) credit utilization ratio.
D) outstanding debt ratio.
Q4) Lending by sales finance companies are most commonly associated with A) borrowing to buy big-ticket items such as vehicles.
B) debt-consolidation loans.
C) Loans in the subpbrime lending market.
D) unsecured loans.
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8
Chapter 7: Credit Cards and Consumer Loans
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160 Verified Questions
160 Flashcards
Source URL: https://quizplus.com/quiz/65483
Sample Questions
Q1) Installment purchase agreements are also called
A) collateral installment loans.
B) chattel mortgage loans.
C) conditional sales contracts.
D) collateral installment loans or chattel mortgage loans.
Q2) Repossession clauses protect the borrower's interest.
A)True
B)False
Q3) Annual and transaction fees are not required to be included in the APR calculation for a credit card because they cannot be known in advance.
A)True
B)False
Q4) When the declining-balance method of calculating interest on installment loans is used,the simple rate of interest and the APR will differ only if fees boost the finance charge.
A)True
B)False
Q5) A personal line of credit is a form of closed-end credit.
A)True
B)False
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Chapter 8: Vehicles and Other Major Purchases
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144 Verified Questions
144 Flashcards
Source URL: https://quizplus.com/quiz/65482
Sample Questions
Q1) Which is not a step in the planned buying process?
A) Prioritizing wants
B) Preshopping research
C) Purchasing on credit
D) Comparison shopping
Q2) Brian has decided he would like to negotiate on a car with a $32,000 sticker price.If the dealer's cost on this car is 15 percent lower than the sticker price,Brian should be able to negotiate a price some what higher than
A) $32,000.
B) $28,800.
C) $27,200.
D) $30,400.
Q3) Buying on impulse not only results in higher spending but failure to obtain what is really wanted.
A)True
B)False
Q4) An acquisition fee cannot be included in the gross capitalization cost.
A)True
B)False
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Chapter 9: Obtaining Affordable Housing
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214 Verified Questions
214 Flashcards
Source URL: https://quizplus.com/quiz/65481
Sample Questions
Q1) The term condominium describes a type of building rather than a form of ownership.
A)True
B)False
Q2) Which of the following is not characteristic of a growing-equity mortgage?
A) It has a fixed interest rate.
B) Payment increases are determined annually on the basis of inflation.
C) Increased payments go to reducing principal owed.
D) The loan is paid off in shorter period of time compared to a conventional loan.
Q3) Real estate property taxes are based on the value of the land,not the buildings.
A)True
B)False
Q4) An escrow account is a special account at a financial institution where funds are held until they are paid to a third party.
A)True
B)False
Q5) Lenders may reduce interest rates in return for larger down payments.
A)True
B)False
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Chapter 10: Managing Property and Liability Risk
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202 Verified Questions
202 Flashcards
Source URL: https://quizplus.com/quiz/65497
Sample Questions
Q1) The homeowner's policy written for condominium owners does not provide which of the following coverages?
A) Primary coverage for the building
B) Personal property coverage
C) Liability coverage
D) Coverage for improvements the owner makes to his or her unit
Q2) Independent agents typically represent more than one insurance company.
A)True
B)False
Q3) One should assume risks that are affordable and insure against losses that would be unaffordable.
A)True
B)False
Q4) ____ policies provide open-peril protection for the dwellings covered under the policy.
A) HO-3
B) HO-4
C) HO-6
D) HO-8
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Chapter 11: Managing Health Expenses
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126 Verified Questions
126 Flashcards
Source URL: https://quizplus.com/quiz/65496
Sample Questions
Q1) Traditional health insurance provides protection against financial loss resulting from the perils of illness and injury.
A)True
B)False
Q2) HMOs generally require that your primary care physician must order all procedures and approve referrals to medical specialists.
A)True
B)False
Q3) Under the Affordable Care Act,a health policy that cost 8 percent of your income for premiums or 9.5 percent of family income if obtained through an employer is referred to as
A) Medicare.
B) benchmark premium.
C) individual shared responsibility fee.
D) affordable health insurance.
Q4) Medicaid pays for the costs of custodial nursing home care.
A)True
B)False
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Page 13
Chapter 13: Investment Fundamentals
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173 Verified Questions
173 Flashcards
Source URL: https://quizplus.com/quiz/65494
Sample Questions
Q1) Leverage is the speed and ease with which an investment can be converted to cash.
A)True
B)False
Q2) Diversification ____ risk,and leverage ____ risk.
A) increases;increases
B) increases;decreases
C) decreases;decreases
D) decreases;increases
Q3) When investing,you want to select a portfolio of investments that will provide the necessary potential total return through current income and capital gains in the proportions that you desire.
A)True
B)False
Q4) Ownership investments generally
A) offer a fixed rate of return.
B) have a set maturity date.
C) offer a limited return.
D) produce capital gains.
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Page 15
Chapter 14: Investing in Stocks and Bonds
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351 Verified Questions
351 Flashcards
Source URL: https://quizplus.com/quiz/65493
Sample Questions
Q1) Which of the following types of companies would tend to have the lowest P/E ratio?
A) Growing
B) Rapidly growing
C) Successful but stable
D) Speculative
Q2) A stock that has a negative beta tends to
A) be stable compared to the market as a whole.
B) be volatile compared to the market as a whole.
C) move up when the market as a whole moves down.
Q3) All states require registration of all securities sold within the state.
A)True
B)False
Q4) ____ is (are)tax deductible for businesses.
A) Interest paid to bondholders
B) Dividends paid to preferred stockholders
C) Dividends paid to common stockholders
D) All of these
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Chapter 15: Investing Through Mutual Funds
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172 Verified Questions
172 Flashcards
Source URL: https://quizplus.com/quiz/65492
Sample Questions
Q1) Mutual funds are readily available to people saving for retirement through 401(k)plans and IRAs.
A)True
B)False
Q2) Open-end mutual funds
A) are sold only through brokers.
B) make up about 75 percent of all mutual funds.
C) are sold at their current net asset value.
D) are sold to other investors on a secondary market.
Q3) It is much easier to select specific stocks and bonds than it is to select an open-end mutual fund share.
A)True
B)False
Q4) Which of the following types of investment companies operates much like an index fund?
A) closed-end fund
B) REIT
C) unit investment trust
D) exchange-traded fund
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Chapter 16: Real Estate and High-Risk Investments
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112 Verified Questions
112 Flashcards
Source URL: https://quizplus.com/quiz/65491
Sample Questions
Q1) Successful investors in speculative investments must always be alert to market developments regarding their investments.
A)True
B)False
Q2) A crude rate of return is a rough measure of the yield on amounts invested that assumes that equal portions of the gain are earned each year.
A)True B)False
Q3) Buying and selling options are techniques used by both conservative and aggressive investors.
A)True
B)False
Q4) The discounted cash-flow method is an effective way to estimate the value or selling price of a real estate investment.
A)True B)False
Q5) The average rate of return for all investors in futures is zero. A)True B)False
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Chapter 17: Retirement Planning
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257 Verified Questions
257 Flashcards
Source URL: https://quizplus.com/quiz/65490
Sample Questions
Q1) People who start saving and investing for retirement during their twenties should aim to reserve 9 to 12 percent of their pretax income every year.
A)True
B)False
Q2) You can take advantage of asset allocation investment strategy and automatic rebalancing your portfolio if you select a _____ account offered through your employer's retirement plan.
A) indexed
B) target-date retirement
C) limited managed
D) strategic allocation
Q3) Retirement is defined as the time period when you stop all work for pay.
A)True
B)False
Q4) Early retirement from an employer would be most beneficial for a person expecting to live longer than the average life expectancy.
A)True
B)False
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