Chapter 1 (practice quiz)

Réussis tes devoirs et examens dès maintenant avec Quizwiz!

identify some common actions taken to achieve financial goals.

- well conceived spending plan - appropriate insurance - informed about taxes and investments

What are the main components of personal financial planning?

1. planning your personal finances 2. managing personal finances 3. making your purchasing decisions 4. insuring your resources 5. investing your financial resources 6. controlling your financial future

Use a financial calculator or the time value of money table to calculate the following: a. future value of $100 at 7% in 10 years b. the value of $100 a year for 6 years earning 6% c. the present value of $500 received in 8 years with an interest rate of 8%

a. $197.72 b. $697.53 c. $270.13

How do age, marital status, household size, employment situation, and other personal factors affect financial planning?

different lifestyles influence spending and saving habits

how can you use future value and present value computations to measure the opportunity cost of a financial decision?

figure out what a value now will be in the future (viseversa) and decide whether the money is needed now or if you would be better off investing

How might the uncertainty of inflation make personal financial planning difficult?

if consumer prices increase faster than income, you are not able to purchase the same amounts of goods and services; higher interest rates

what are some common risks associated with financial decisions?

inflation, interest rate, income, personal, and liquidity

why should you reevaluate your actions after making a personal financial decision?

make priority adjustments that will bring your financial goals and activities in line with your current life situation

what are common sources of financial planning information?

media, financial institutions, financial specialists

What are examples of long-term goals?

owning a house, paying off student loans

What are the main elements of every decision we make?

situation and values

what are the 5 main characteristics of useful financial goals?

specific, measurable, action oriented, realistic, time-based

What is the purpose of a financial plan?

summarize you current financial situation, analyze financial needs, recommend future financial activities

what factors influence the levels of interest rates?

supply and demand


Ensembles d'études connexes

Anxiety, Obsessive Compulsion and Related Disorders

View Set

MIS 301 Chapter 11 Customer Relationship Management

View Set

Cellular Respiration Chapter 7 Part 2

View Set

Part 2: The Strange Case of Dr. Jekyll and Mr. Hyde: Plot Development and Conflict Assignment

View Set

female reproductive system - sherpath

View Set

BIO 204 Lab 18 - Litmus Milk Reactions

View Set

AZ-900 Microsoft Azure Fundamentals Dumps Online is valid for passing | DumpsBase

View Set