Personal Money Management (BFIN 1003) - Final Exam

A Department of the Treasury Form W-4 is a complicated multi-page document to be completed by each employee annually.

False

A bank check is a valid contract.

False

A payment authorization, when using Amazon to buy socks, is the same as signing a contract.

False

Blue Book Value is used when calculating liability insurance coverage.

False

Buying a car from a quality dealer is a good substitute for calling your financial buddy.

False

I should always hire a lawyer when I am asked to sign a contract.

False

If I currently pay $800/month rent I should easily afford buying a house.

False

If I had earnings of $4,000 on my W-2 then I will forfeit my deductions to the government unless I file.

False

If the house I buy is a starter home then I can plan on moving in a year.

False

Most states that have raised the minimum wage have experienced a sharp and sudden drop in job growth.

False

My financial buddy should be an expert in the stock market.

False

Once a W4 form is submitted to the federal government there is no need to complete a new one ever again, even upon changing employers.

False

Place-of-work is always understood and is never explicitly specified in an employment contract.

False

The ABA routing and account information shown on the bottom of your paycheck specifies your personal bank account for funds to be deposited into.

False

The IRS uses the same regressive tax table for every person in the U.S.

False

The NJ Living wage is below the defined poverty line.

False

The U.S. has a progressive tax rate system such that at very high income levels you pay 100% of your earnings to taxes.

False

The courts will not accept a contract written in every-day common language.

False

The location of the house I want to buy will have a minor impact on the finances.

False

The remaining car loan amount should be shown on my balance sheet as an asset.

False

The smartest financial analyst you can find on the web, even if you don't know them, make the best financial buddy.

False

Using the money in my educational 529 Savings Plan for a vacation over spring break is allowed only if I am a full-time student that semester.

False

unemployment rates 2015 through 2017 for persons 25 years and older show no difference for levels of education achieved.

False

A rainy day fund is used for unplanned splurge expenses like flying to Las Vegas for the weekend to see your favorite band play in concert.

True

A sailboat captain will use a stationary object to evaluate the progress toward a destination, just like a budget is a stationary reference point.

True

AAA puts the 2015 average estimate to own and operate a car at $725 per month.

True

Agreeing to the insurance policy at the retail store for the item you are buying is always a bad financial deal as cheaper solutions just require you to shop for the insurance.

True

Americans who were middle-aged in 1979 have seen their standard of living rise sharply compared to both their own previous experience and to the previous generation.

True

An agreement without consideration is not a contract.

True

An important finding of Kahneman and Deaton's research of 450,000 US residents is that people can say their life is going well even though they're unhappy right now, and vice versa.

True

Apartment insurance policies are cheap and especially useful if they provide coverage in the case of water damages.

True

Behavioral Science's Dual Process Theory originated at Princeton University in 2002

True

Behavioral Science's Rational Choice Theory originated at the University of Chicago in 1980.

True

Being able to move into your own apartment and live on your own can be significantly helped by building a personal budget.

True

Between 1970 and 2000 the median earner working to afford the median-priced home would have increased their 40 hours per month to 70 hours per month to carry the cost.

True

Breach-of-Contract means when one party fails to perform his part of the agreement.

True

Cash, in the local currency, is the most liquid of assets.

True

Credit Unions have less fees and the same or better rates with the equivalent federal government insurance coverage as the commercial retail banks.

True

Daniel Kahneman and Angus Deaton of Princeton University found people's day-to-day emotional state rose with average annual income only until about $75,000 and then plateaued.

True

Don't care who's fault the accident was caused by is covered by no-fault rider.

True

Each employee actually costs the employer slightly more than the employee gross pay to help pay for government provided worker benefits.

True

Earning a college bachelor degree is no guarantee that you will manage your money well.

True

Even a used car that is a junker shows on my balance sheet with more value than my pet.

True

Families with children aged 0 to 17 were more likely than families without children to experience financial burdens of medical care.

True

For college students, identity theft insurance is most likely a waste of money.

True

GAP car insurance covers the remaining lease payments until the car is repaired.

True

GM sold more cars than Toyota or Ford in 2015.

True

Graham Hills Ted Talk suggests that we add to our stress by having too much stuff to care for.

True

Groups such as Public Citizen argue that people are forced to waive their legal rights because arbitration clauses are presented in contracts on a take-it-or-leave-it basis.

True

Having your job title specified in your employment contract specifies the scope of your corporate role.

True

I can use Free File even if I file for an extension.

True

I need to know if my parents claimed me on their tax return form before I file my taxes.

True

I will receive a Form 1099-int from my bank totaling the interest earnings on my savings account for the year.

True

If I am self-employed with earning of more than $400 then the IRS states I must file.

True

In general , university credit unions offer students better and more cost-effective services than commercial banks.

True

In general, employee deductions pay for 70% for government worker benefits programs and corporations pay 30%.

True

In general, more education increases employment prospects and earnings.

True

Insurance companies and HMO's usually negotiate a 50% discount for hospital services.

True

Insurance is the equitable transfer from one entity to another the potential loss risk in exchange for a payment.

True

Justice Ruth Bader Ginsburg, the lone dissent in an 8:1 decision, criticized her peers for not considering the Credit Repair Organizations Act in the way a consumer would.

True

Keeping score of your wealth is done with a balance sheet.

True

Once I assemble all of my paper records I should be able to file in less than 2 hours.

True

One innocent way to damage your credit score is keeping a high balance on your credit card.

True

Pay-Back is a skill representing the ability to manage available credit and cash into and out of debt.

True

Purchasing the extended warranty for my pre-owned car from the dealer is usually a wise option if the car is not certified.

True

Rich or poor, we all pay a higher percentage of tax on income over $100,000 compared to income under $10,000.

True

Seton Hall costs more than the national average but also has higher graduation rates and higher starting salaries.

True

So I earn money in 2014 and file taxes on my 2014 earnings by 4/15/2015.

True

Some Americans have decided to delay any vacation due to debt levels.

True

Sometimes the monthly cash flow to maintain a car can break my budget even though the purchase price was a great deal.

True

Sometimes we can guess that things might go wrong and spell out remedies in advance.

True

The #1 challenge to using a budget is to keep doing it and not stop.

True

The ACA allowed over 3 million young adults to stay on their parents health insurance plan until 26.

True

The Federal Withholding amount is calculated based on your W4 elections.

True

The Total Cost of Ownership includes not only loan interest, maintenance and repair expenses but also insurance, taxes, and fees.

True

The average age of cars on the road in 2015 is 10 years.

True

The average length of time a car is kept is 6 years.

True

The best place to get answers to my student tax questions is www.IRS.gov

True

The best time to learn how to use a budget is when your life is simple and you don't really need a budget.

True

The courts have held there is no excuse for not reading the contract.

True

The estimated average indebtedness of a SHU graduating undergraduate is $35,000.

True

The median income among families headed by someone under thirty-five was just under $35,500 in 2013, which when adjusted for inflation was 20% less than families earned in 2001.

True

The obvious reason for me to file a federal income tax return while a student is to get the refund of money withheld from that summer job as shown on my W2.

True

There are 6 types of banking institutions but credit unions often have significant advantages for college students and recent graduates

True

There are two emotional contributors to happiness, emotional wellbeing and an evaluation of their life.

True

Total cost of ownership for a car includes insurance, inspection fees, and gas.

True

Traditional finance academic theory is associated with the modern portfolio theory and the efficient market hypothesis first outlined by Harry Markowitz in 1952.

True

Under the Dodd-Frank Act, the new Consumer Financial Protection Bureau has to conduct an arbitration study and can prohibit or impose conditions on the use of binding arbitration in the public interest and needed for the protection of consumers.

True

We are all blends of biases, be it spender or a saver, but knowing your bias allows you to manage your bias.

True

You may not withdraw monies from your IRA retirement account before retiring unless there is an emergency.

True

You pay 1.45% out of your pay and your employer pays an additional matching 1.45% to support Medicare.

True

Your employment contract should clarify if you are expected to work overtime and if you will be paid for it.

True

Your name should appear clearly on the paycheck and exactly the same on the paystub.

True

read the fine print is a reference to the small print font of a legal contract where the very small details are written.

True

A living wage does not provide enough income for ever eating at restaurants, save for a rainy day, or pay for education loans.

True

A paycheck is a 3 part record of 3 money transfers between 3 parties.

True

A good rule of thumb is 10% depreciation per year of ownership.

True

401K is a retirement savings plan

True

A car lease may be a decent financial deal if I would always get a new car every two years anyway.

True

A common scam targeting students is to call telling them they have a tax refund to sent to them and all they need is the student's personal financial information.

True