money matters spring final exam

you invest your money into an account that gives an intrest rate of 4%. how many years will it take to double your money?

18% (bc 72/4)

Amount of paycheck you should save

20%

How much of your paycheck should go into savings

20%

when dealing with your credit card balance what percentage should you stay under on your credit line?

30%

All of following are characteristics of employer sponsor accounts

401k

According to experts emergency funds should include enough money to cover your expenses for

6 months

Your emergency fund should cover expenses for how long

6 months

rule 72

72 divided by the interest rate

Who is credited for discovering the mathematical equation for compounding interest?

Albert Einstein

The rate at which interest is charged on a credit account and is the cost of credit expressed as a yearly rate:

Annual Percentage Rate

Your financial ability to meet credit obligations:

Capacity

Your assets and net worth are considered your:

Capital

Type of bankruptcy that allows a consumer to remove all of their debts:

Chapter 7

General conditions that affect your ability to repay a loan is called:

Conditions

Something of value exchanged for something else of value is called:

Consideration

A legally binding agreement that specifies the rights and duties of each party of the agreements is:

Contract

A business that gives you a loan:

Creditor

Someone who borrows money:

Debtor

Family members, children, your spouse are called

Dependants

A qualified stockbroker who buys and sells securities at a reduced commission and provides limited services to clients is called:

Discount Broker

This helps spread the risk of investments:

Diversification

Cash deposit toward the purchase of a car that is paid up front:

Down payment

A government insurance program that will pay back account holders if the bank or lending institution fails

FDIC

Savings accounts at banks are protected by

FDIC Insurance

This person helps you define and reach your financial goal:

Financial Planner

These are paid to the mutual fund company when you first purchase the fund:

Front End Loads

A type of warranty where a defective product can be fixed or replaced during a reasonable amount of time

Full warranty

A group of similar stocks and bonds:

Index

A number measured by the government that describes the changing prices of everyday goods.

Inflation

The rise in general level of prices:

Inflation

This type of loan allows the borrower to repay in a specific number of equal payments:

Installment

A written agreement that allows a tenant to use property for a set period of time time at a set rent payment is called:

Lease

Type of Warranty that covers only certain aspects of the products like parts.

Limited Warranty

The act of making a plan and carrying it out to ensure that event takes place is called:

Logistics

The largest organized stock exchange in the United States:

New York Stock Exchange

Securities are bought and sold through brokers, but not through a stock exchange, the transaction is called

Over the counter

An interest rate that can change during the course of the loan and is based on the prime index rate.

Prime Rate

A legal document issued by an investment company that provides details about the securities it offers for sale is called:

Prospectus

A written contract that allows you to leave the lease any time as long as you give the required notice is called:

Rental Agreement

This type of debt is tied to a specific asset that can be used as collateral and repossessed if the borrower doesn't make payments

Secured

A refundable amount paid to cover damages to property caused by a tenant is called:

Security Deposit

Having money left over after meeting your expenses

Surplus

Return on Investment

Take the amount earned divided by the initial deposit

The value of an existing vehicle that applies to your own down payment:

Trade in

Someone who can tolerate a risky investment would

Understand that an investment that fell when the entire market fell was not necessarily a bad investment

Can be paid in interest and dividends

Yield

you forgot to pay last months credit card bill your creditor will probably....

add finance charges and late fees to your bill

a budget can help you reach a financial goal by

allowing you to see where you can cut back on spending

a U.S savings bond

are worth face value at maturity

what should you consider regarding audio insurance for buying a vehicle?

both A and C (type and where you live)

what is investing

both,wealth accumulation and focus on increasing future income

a high school junior wants to be able to pay of all of next years prom an senior trip by himself, using his money from his part time job where he gets paid twice a month. what would be a good savings plan for him.

calculate how much money he will need to save out of each pay check and then create a budget that allows him to save the necessary money

a landlord has the right to

charge you a late fee stated in your lease if your rent is late

what is one reason you might use a checking account instead of saving account

checking accounts are great for making online purchases and paying bills

what is not a type of insurance

deductible

your FICO score

depends most on the amount you owe and your payment history

you purchase 100 shares of atnt stock the company pays you 20 cents per share to the shareholders at the end of the quarter. this money is called

dividends

If you by enough different stocks you can diversify out all risk in the stock market

false

formula for rate of return

final value minus initial value divided by initial

when using a debit card to make a purchase you must be certain you..

have enough funds in your account

Why is it dangerous to look paycheck to paycheck

if you lose your job you will have no where to pay bills

a yield can be payed in the form of

interest and dividends

a 27 year old wants to make sure she has enough money to retire by the time shes 67.what strategy would be the best to help her met her goal?

invest automatically in a mutual fund and let money grow for decades

if you have a long time horizon for investing you should

lean toward high risk investments with a high return potential

which of the following is an investment

money deposited into your 401k

out of the following item which is not a type of investment tool

money market account

bob charged 200$ for a plane ticket last month on his credit card, when he received his statement he saw that he could pay the minimum balance of 25$. bob calculated it and it would take him 8 months to finish paying off his 200$ ticket. is he correct?

no bob will be charged interest on the balance he owes each month

which of these is an Example of delayed gratification when it comes to spending or saving money

pack your lunch instead of dinning out each day and then save all of the money for vacation

money in your emergency fund can be used wisely to..

pay for an unforeseen health expense

you borrowed 50$ from your rich cousin and had to pay back 60$. what was the original 50$ called?

principle

a qualified broker sells security at a reduced commission provides limited

reduced discount broker

what are some typical expenses for a person just starting out in a rental apartment

rent,renters insurance and transportation cost

if your computer is stolen from your apartment what type of insurance would it be covered under

renters

what is a good strategy for saving money

set aside part of each paycheck to savefirst and then build your budget around that

a surplus can be best defined as

the money left over after meeting your expenses

improving your credit score will let you get lower interest rates on loans

true, better credit equals lower interest

if you cause damage to your apartment your landlord can

use all or a portion of your security deposit to pay for the damages