BPA Personal Financial Management Practice
An advantage of a Roth IRA is a. you can defer taxes until the money is withdrawn. b. there is no restriction on when you can withdraw the money without penalty. c. your money will increase at the same rate as the S&P 500. d. your employer will match your investment amount
A
By what date must employers send Form W-2 to employees each year? a. January 31 b. March 31 c. April 15 d. April 30
A
Identify theft occurs most often through a. the Internet b. an ATM c. a retail store d. your friends
A
Most experts agree that retirement planning should begin a. as soon as you begin your career b. when you get marries c. when you begin to accumulate enough wealth to put money away d. when you get within 15 years of retirement
A
Taxes withheld from an employee include all except a. unemployment tax. b. income tax. c. Social Security tax. d. Medicare tax.
A
The United States uses a progressive income tax structure, meaning a. the more money you make the higher percentage of taxes you will pay. b. everyone will pay an equal percentage of tax. c. the less money you make the higher percentage of taxes you will pay. d. you don't have to pay taxes after you reach a certain level of income.
A
The primary advantage a mutual fund gives an investor over an individual stock is a. diversification. b. greater risk. c. higher load percentage. d. more control for the investor.
A
The sum paid by a policyholder to keep an insurance policy in force is a a. premium b. claim c. deductible d. co-pay
A
The type of auto insurance that covers the cost of repairs to your car when an accident is your fault is _____. a. collision b. comprehensive c. liability d. property
A
This classification of stock allows you to vote in corporate matters. a. Common b. Preferred c. Treasury d. Stock option
A
This one of the "Cs" of credit refers to an applicant's assets minus their liabilities a. Capital b. Collateral c. Character d. Capacity
A
What action should be the last step in most situations when dealing with increasing and uncontrollable personal debt? a. declare bankruptcy b. hire a credit counselor c. get a second job d. pay off as much as you are able
A
What is the name given to the index that uses 30 stocks to represent the thousands of stocks listed on the New York Stock Exchange? a. The Dow Jones Industrial Average b. The S&P 500 c. The Fortune 500 d. The NASDAQ Composite
A
What is the name given to the index that uses 30 stocks to represent the thousands of stocks listed on the New York Stock Exchange? a. The Dow Jones Industrial Average b. The S&P 500 c. The Fortune 500 d. The NASDAQ Composite
A
When filing a federal tax return, what government agency do you file it with? a. Internal Revenue Service b. Federal Reserve c. Securities and Exchange Commission d. Income Tax Commission
A
Which of the following health care services is most likely not covered by health insurance? a. Cosmetic surgery b. Annual checkup c. X-ray on an injured ankle d. Prescription cholesterol medication
A
Which of the following is generally considered to be the least risky investment? a. Certificate of Deposit b. Corporate Stock c. Corporate Bond d. Mutual Fund
A
Which of the following retirement accounts typically includes a company match into the employee's account? a. 401(k) b. Mutual Fund c. IRA d. Social Security
A
Which retirement plan most likely includes company match? a. 401K b. IRA c. Roth IRA d. Mutual Fund
A
Which type of bankruptcy forces the person filing to sell off their assets? a. Chapter 7 b. Chapter 11 c. Chapter 12 d. Chapter 13
A
Which type of insurance is not typically purchased by most individuals? a. Pet b. Health c. Auto d. Life
A
You auto insurance policy includes liability and collision coverage with a deductible of $500, If another driver hits your parked car and causes damage to your car of $700 and damage to their own car of $450, what is the amount of money you will pay out of pocket? a. $0 b. $200 c. $650 d. $1,150
A
You can reduce the cost of your homeowner's insurance by a. installing dead bolt locks on your outside doors. b. building your home using siding instead of bricks. c. taking out your old security system because it no longer works. d. leaving your car in the driveway at night
A
You may begin to withdraw money from your 401(k) plan at what age, assuming you have stopped working? a. 59.5 b. 62 c. 65 d. 70.5
A
______ is property required by a lender and offered by a borrower as a guarantee of payment on a loan. a. Collateral b. Interest c. Default d. A down payment
A
. Your homeowner's insurance policy includes a deductible of $500. If your house receives wind damage from a recent storm estimated at $2,100, how much will you have to pay out of pocket? a. $ 0 b. $ 500 c. $1,600 d. $2,100
B
Discretionary spending would be money you spend on a. shoes to replace a worn out pair. b. tickets for a basketball game. c. a gallon of milk. d. your monthly electric bill.
B
For a traditional IRA, at what age can you begin to make withdrawals without penalty? a. 59 b. 59½ c. 60 d. 70½
B
IRA stands for a. Individual Retirement Annuity b. Individual Retirement Account c. Invested Retirement Annuity d. Invested Retirement Account
B
If you are involved in an automobile accident and you are at fault, the portion of car insurance known as collision is used to cover the cost of ________. a. repairs on the other driver's car b. repairs on your own car c. medical treatment for the other driver d. property damage caused by the accident
B
In bankruptcy cases, information on a personal credit report stays on the file for: a. 5 years b. 10 years c. 15 years d. 20 years
B
P x R x T is the calculation for a. compound interest. b. simple interest. c. return on investment. d. return on equity.
B
The types of insurance that most individuals will need in their lives include all except: a. Health b. Hurricane c. Auto d. Homeowners
B
This type of stock includes voting rights. a. treasury stock b. common stock c. buyback stock d. preferred stock
B
To protect the home you own from damages, you need what type of insurance? a. Renter's insurance b. Homeowner's insurance c. Collision insurance d. Life insurance
B
What is an advantage of a Roth IRA? a. You invest before-tax dollars. b. Your earnings are tax-free. c. You must begin withdrawing the money at age 70½. d. You don't have to pay a penalty on the earnings if you withdraw early
B
What is the amount of interest you will pay if you borrowed $500 for 1 year, at an interest rate of 6% with interest compounded annually? a. $7.50 b. $30.00 c. $30.68 d. $38.18
B
What is the amount of interest you will pay on a 90-day, 7% loan if you borrowed $1,500, assuming simple interest a. $25.89 b. $26.25 c. $105.00 d. $262.50
B
Which of the "Cs" of credit refers to property offered by the borrower to secure a loan? a. Capital b. Collateral c. Character d. Capacity
B
Which of the following individuals would be eligible for a 403(b) retirement plan? a. Financial Analyst b. School Teacher c. CPA d. Medical Doctor
B
Which of the following is not an advantage of established in IRA? a. The growth of an IRA can be made at any time without penalty. b. The withdrawals from an IRA can be made at any time without penalty. c. The contributions to an IRA may be partially or fully tax-deferred. d. You determine the level of risk and rate of return when you select IRA
B
Which of the following payment options will give you the highest paycheck, assuming an equal annual salary for all options? a. weekly b. semimonthly c. bi-weekly d. every other week
B
You own 400 shares of Cardinal Inc., whose Board of Directors has just declared a quarterly dividend of 0.15 per share. How much will you receive when the dividend is paid? a. $15.00 b. $60.00 c. $120.00 d. $240.00
B
You purchase 50 shares of Chips Unlimited Inc. for $87.35 per share. Three months later your shares are now worth $84.56 per share. How much has your investment value decreased? a. $2.79 b. $139.50 c. $4,228.00 d. $4,367.50
B
Your homeowner's coverage includes a deductible of $500. If a storm damage to your roof is estimated to be $1,400, how much will you pay out of pocket? a. $0 b. $500 c. $900 d. $1,400
B
Your homeowner's coverage includes a deductible of $500. If a storm damage to your roof is estimated to be $1,400, how much will your insurance cost? a. $500 b. $900 c. $1,400 d. $1,900
B
Your take home pay for the month is $4,250. Your fixed expenses for the month are $3,375. Given a monthly savings goal of $400. how much discretionary spending do you have per month? a. $400 b. $475 c. $875 d. $3,850
B
A one-year Certificate of Deposit pays 2.5% interest. If you invested $750 on February 1, 2017, what amount would you receive from the bank on February 1, 2018? a. $751.88 b. $765.00 c. $768.75 d. $937.50
C
A small, fixed amount required by a health insurer to be paid by the insured for each outpatient visit or drug prescription is known as a a. deductable b. claim c. co-pay d. benefit
C
A tip to improve your credit score when you are young would be to a. only stay in a part-time job for a few months b. apply for several credit cards c. open and maintain a checking account d. pay off a credit card bill no more than two weeks late
C
According to the Credit Card Act of 2009, what is the earliest age that a person can apply for and receive a credit card, without restriction and without a cosigner, so long as they are financially approved by the credit card company? a. 16 b. 18 c. 21 d. 25
C
The maturity value of a loan is equal to a. Principal - Interest b. Interest - Principal c. Principal + Interest d. Principal x Interest
C
The maturity value of a loan is equal to a. Principal - interest b. Interest - principal c. Principal + interest d. Principal x interest
C
The portion of earnings paid out to the stockholders of a corporation is called _______. a. retained earnings b. net income c. dividends d. capital stock
C
The rule of 72 says that an invest earning 6% annually will double in ______ years. a. 6 b. 10 c. 12 d. 72
C
The tax form sent to each employee in January showing the amount of wages earned and taxes withheld in the prior year is known as Form a. 1040. b. 1040EZ. c. W-2. d. W-4.
C
The three common credit scores agencies include all of the following except: a. Experion b. Transunion c. Better Business Bureau d. Equifax
C
The type of stock that gives priority status to dividends is _____. a. common b. treasury c. preferred d. owners
C
When decided the amount of life insurance coverage you would need, you should consider all of the following except: a. Cost of your funeral arrangments b. Expected cost of college for your high school age child c. Salary of your single child that recently graduated college d. Amount of debt you currently have
C
Which if the following would not have positive impact on your credit score? a. Opening and maintaining a savings account b. Paying off a short-term loan on time and in full c. Applying for and receiving several credit cards d. Buying a television on credit and paying it off when it comes due
C
Which of the following investments is most likely the riskiest? a. Certificate of Deposit b. Blue chip stock c. Internet company IPO d. Bank Savings Account
C
Which of the following is the highest FICO credit score possible? a. 100 b. 500 c. 700 d. 1,000
C
Which of the following lists of investments is ordered correctly from the least risk to the most risk? a. Certificate of Deposit, Stock, Mutual Fund b. Mutual fund, Stock, Certificate of Deposit c. Certificate of Deposit, Mutual Fund, Stock d. Mutual Fund, Certificate of Deposit, Stock
C
Which of the following people would need life insurance the most? a. Married, retired, no kids, debt b. Single, recent college grad, working, no kids, college and car loans c. Married, two kids in grade school, both spouses work, mortgage d. Single, retired, two kids both on their own with families, car loan
C
Which of the following people would not have a need for life insurance? a. Married couple that just bought a new home but has no children b. Single person that rents an apartment and has one young child c. Single person that owns a house but has no children d. Married couple that rents a house and has two children
C
Which of the following websites is authorized by the federal government to provide consumers with a free credit report once a year? a. freecreditreport.com b. creditkarma.com c. annualcreditreport.com d. creditreport.com
C
Who would typically pay a higher premium on their car insurance? a. retired male b. middle-aged female c. teenage male d. young adult female
C
You buy 100 shares of a stock on January 23rd @ $24.57 per share. You sold those same shares on December 6th for $31.26 per share. What was your percentage gained on the transaction, ignoring fees and commissions? a. 6.7% b. 21.4% c. 27.2% d. 31.3%
C
You buy 50 shares of a stock on October 1 @ $72.30 per share. You sold those same shares on December 15 for $83.13 per share. What was your percentage gained on the transaction, ignoring fees and commissions? a. 10.8% b. 13.0% c. 15.0% d. 21.7%
C
You have owned 50 shares of Summit Corp. for the past three years and own those shares for all of 2016. Summit Corp. pays quarterly dividends of $1.25 per share. How much will you receive in dividends for 2016? a. $ 62.50 b. $187.50 c. $250.00 d. $750.00
C
You put $1,200 in a 6-month Certificate of Deposit paying 4% simple interest. What is the maturity value of your CD? a. $1,200 b. $1,204 c. $1,224 d. $1,248
C
You use a stock broker to purchase 200 shares of Capital Corporation @ $67.75. Assuming the broker receives a 2% commission, how much money will you pay for your purchase? a. $13,279 b. $13,550 c. $13,821 d. $16,260
C
_________ have been eliminated by many companies in recent years as a way to cut costs. a. 401K programs b. Stock options c. Pensions d. Individual retirement accounts
C
A mutual fund shows a NAV of $32.65 and a minimum initial investment of $5,000. To invest in this fund, how many shares must you buy? a. 151 b. 152 c. 153 d. 154
D
An estimate of income and expenditures for a period of time is known as a(n) _____. a. credit report b. income statement c. portfolio d. budget
D
Credit scores are determined by payment history, the amount of the outstanding debt, the length of your credit history, inquiries on your credit report, and the types of credit you are using. The credit score considered the best would be _______ a. 200 b. 400 c. 600 d. 800
D
How old must you be to have a credit card in your name without showing proof of independent income or having a co-signer? a. 16 b. 18 c. 20 d. 21
D
Investing into different types of securities is known as a. Converting b. Stockpiling c. Expanding d. Diversifying
D
On December 17th the stock of Sticks and Stones Corp. was listed at $62.14. Your broker has placed a buy order to purchase 100 shares of the stock. The broker charges a 2% commission. How much will the transaction cost you? a. $ 124.28 b. $ 621.40 c. $6,214.00 d. $6,338.28
D
Ownership in a corporation is shown by a. bonds b. employees c. revenue d. stock
D
Paying a specified dollar amount on your health insurance for services such as a doctor's office visit is known as a a. deductible. b. premium. c. policy. d. co-pay
D
Personal tax returns must be filed with the federal government each year by a. January 31. b. March 15. c. March 31. d. April 15
D
Taxable income includes all of the following except _____. a. tips you earn at work b. wages from your job c. interest from your savings account d. exemptions for each child you have
D
The FDIC protects your money in a savings account up to a maximum of a. $100,000 b. $150,000 c. $200,000 d. $250,000
D
The following service is generally not included in most health insurance policies a. Hospital stay b. X-ray c. Checkup d. Cosmetic Surgery
D
The government agency that oversees the stock markets is the a. Internal Revenue Service b. Treasury Department c. Federal Reserve d. Securities and Exchange Commission
D
The ideal investment in terms of risk and return would be a. high risk, high return b. high risk, low return c. low risk, low return d. low risk, high return
D
The stock exchange in the United States that has 100% of its transactions occurring through a computerized network is the _____. a. NYSE b. Nikkei c. S&P 500 d. NASDAQ
D
The two primary stock exchanges in the United States are a. NASDAQ and SEC b. SEC and NYSE c. NYSE and Nikkei d. NYSE and NASDAQ
D
The two primary stock exchanges in the United States are the a. Dow Jones and NASDAQ b. Dow Jones and Nikkei c. Nikkei and New York Stock Exchange d. New York Stock Exchange and NASDAQ
D
The type of auto insurance that pays for the cost of damage to a car you hit is a. collision. b. medical. c. no-fault. d. liability.
D
What is the Patient Protection and Affordable Care Act more commonly known as? a. Employercare b. Patientcare c. Insuracare d. Obamacare
D
What is the formula to calculate simple interest? a. Principle x Rate / Time b. Principle + Rate x Time c. Principle + Rate / Time d. Principle x Rate x Time
D
Which of the following investments most likely contains the highest risk? a. Blue Chip Stock b. Certificate of Deposit c. Government Savings Bond d. Stock of a startup company
D
Which of the following is no longer allowed with the passing of the Credit Card Act of 2009? a. Giving incentives such as money back on purchases using credit cards. b. Allowing a person to have more than two credit cards in your name. c. Having a credit limit on your credit card. d. Credit card companies doing promotions on college campuses
D
Which of the following would be a variable expense on your budget? a. rent b. auto loan repayment c. 401(k) withholding from your paycheck d. clothing
D
Which of the following would hurt your credit score? a. Paying your bills on time b. Staying at your job for multiple years c. Getting married d. Applying for multiple credit cards
D
XYZ Incorporated has 900,000 shares of common stock outstanding. Its earnings for 2013 year was $2,750,000 and for 2014 were $2,925,000. What was the EPS for 2014? a. 0.31 b. 0.33 c. 3.06 d. 3.25
D
You may continue to contribute to an IRA account up to the age of: a. 59.5 b. 62 c. 65 d. 70.5
D
You use a broker to invest in the stock market, who charges a 2% commission on all trades. If you buy 75 shares of a stock trading @ $43.39 through your broker, what will your total cost be? a. $3,254.25 b. $3,256.25 c. $3.297.64 d. $3,319.34
D
