personal finance midterm

What actions might a person take to identify alternatives when making a financial decision

A person might continue the same course of action, expand the current situation, change the current situation, or take a new course of action.

Match the following common goals to the life situation of the people listed A. pay off student loans B. Start a college savings fund C. Increase retirement contributions D. Finance long term care

C. A young couple without children D. an older person living alone A. a person who just completed college B. a single mother with a preschool daughter

Why are career planning activities considered to be personal financial decisions

Like other decisions, career choice and professional development alternatives have risks and opportunity costs. Career choices require periodic evaluations of trade-offs related to personal, social, and economic factors. Changing personal and social factors will require you to continually assess your work situation. The steps of financial planning process can provide an approach to career planning, advancement, and career change.

What are some examples of long-term goals

Long term goals are financial objectives more than just a few years off, usually more than five years, such as retirement savings, money for children's college education, or other long-term savings goals.

What are the main characteristics of useful financial goals (smart)

Specific, measurable, action oriented, realistic, time based.

For the following situations, identify the type of risk being described. Not getting proper rest and exercise. Not being able to obtain cash from a certificate of deposit before the maturity date. Taking out a variable rate loan when rates are expected to rise. Training for a career field with low potential demand in the future.

Personal liquidity interest-rate income

How do personal and economic factors affect the operation of the financial system and personal financial decisions?

Personal factors, such as income, household size, and personal value, and economic factors including global business activities, inflation, and interest rates, will influence a person's daily spending activities and long-term financial decisions through the amount of income available, buying needs, and selection of investments.

What are some examples of personal opportunity costs

Personal opportunity costs include time used for one activity that cannot be used for another activity. Other personal opportunity costs relate to health, example; poor eating habits, lack of sleep, or avoiding exercise.

What does time value of money measure

Time value of money calculations, future value and present value, are used to compute interest earned and the value of a sum of money at a later date.

For each of the following situations, indicate if the person would tend to suffer or tend to benefit from inflation. A person with money in a savings account A person who is borrowing money A person who is lending money A person receiving a fixed income amount

suffer benefit suffer suffer