FIN 300- Unit 1 Video Questions

The variables in a future value of a lump sum problem include all of the following, *except*: A. future value B. time period C. interest rate D. payments

payments

Retirees also have varying amounts of social security that is taxed based upon the amount of their income. In some cases, the difference can vary between _____ and _____ being taxed. A. 50%; 85% B. 40%; 75% C. 30%; 60% D. 20%; 65% E. 25%; 55%

50%; 85%

____ is a check that you have written but has not been present to the ban for payment A. A deposit in transit B. A certified check C. A bank error D. A money order E. An outstanding check

An outstanding check

How should the assets you own be reported in your personal balance sheet?

At the actual or estimated current value of the asset

Financial intermediaries' main goal is to:

Charge an amount that will pay them to operate and charge an adequate interest rate

A common error made when solving a future value of an annuity problem is:

Multiplying the annual deposit and the number of years before calculating the problem

Investments held for less than one year will be taxed at ______, whereas investments that have been held for over one year are taxed at ______. A. Capital gains rates; ordinary income rates B. Ordinary income rates; capital gains rates C. Capital gains rates; short term rates D. Long term rates; ordinary income rates E. Long term rates; short term rates

Ordinary income rates; capital gains rates

According to the video, what can be thrown in a wastebasket? A. Receipts for small non-tax-deductible purchases B. Quarterly investment account statements C. Receipts for expired warranties D. Receipts for small non-tax-deductible purchases and Quarterly investment account statements E. Receipts for small non-tax-deductible purchases and Receipts for expired warranties

Receipts for small non-tax-deductible purchases and Receipts for expired warranties

____ individuals are those who have bank accounts, but still use high-cost financial service companies

Underbanked

According to the video, which of the following is not mentioned as a financing opportunity for the unbanked? A. Car Title Loans B. Check Cashing Outlets C. Pawnshops D. Corporate Bonds E. Payday Loans

Corporate bonds

Mark is divorced from his wife Sharon. Mark pays alimony to Sharon and ____________ this amount on his tax return. If Mark paid child support, he could ___________ this amount on his tax return. A. Doesn't report; not deduct B. cannot deduct; not deduct C. can deduct; deduct D. can deduct; not deduct E. cannot deduct; deduct

can deduct; not deduct

How would a *decrease* in the interest rate effect the future value of a lump sum, single amount problem (all other variables remain the same)?

decrease the future value

How would an *increase* in the interest rate effect the present value of an annuity problem (all other variables remain the same)?

decrease the present value

How would a *decrease* in the interest rate effect the present value of a lump sum, single amount problem (all other variables remain the same)?

increase the present value

Which of the following is NOT an example of tax credits? A. child tax credits B. large family credits C. foreign tax credits D. residential energy credits E. education credits

large family credits

If the providers in the financial system dramatically change their behavior by significantly reducing their savings, this has the potential to:

lead to higher interest rates

What is (are) the main goal(s) of tax planning relating to retirement and education planning? A. To provide essential resources for specific events in the future. B. To lower income during high tax bracket times and shift some income to low tax bracket times. C. To calculate the income necessary to fulfill minimum living requirements. D. To provide essential resources for specific events in the future and To lower income during high tax bracket times and shift some income to low tax bracket times.

To provide essential resources for specific events in the future and To lower income during high tax bracket times and shift some income to low tax bracket times.

The first step in the Financial Planning Process is to determine your current financial situation. This includes reviewing all of the following, *except*: A. current income B. amount of savings C. personal values D. amount of expenses E. debts owed

personal values

Bailey is currently learning about the proper places to keep personal financial records in one of her classes in college. Where should Bailey tell her parents to keep her birth certificate, their marriage license, and mortgage documents for their house?

safe deposit box or fireproof safe

The variable that you are solving for in a future value of an annuity problem is:

the future value

The variable that you are solving for in a present value of an annuity problem is:

the present value

Goals that are SMART, include all of the following *except*: A. Specific B. Measurable C. Action-oriented D. Realistic E. Thoughtful

thoughtful

According to the end of the video, what is the goal of budgeting? A. To make sure you live within your income B. To spend your money wisely C. To attain your financial goals D. All of the above E. None of the above

All of the above

Preston is currently self-employed and owns Financial Planning by Preston. He currently can contribute 20% of his business income into his retirement account. Which of the following retirement plans does he most likely have? A. 401(K) B. Deficit C. Individual Retirement Accounts (IRA's) D. Keogh Plan E. Roth Individual Retirement Plans (Roth IRA)

Keogh Plan

what is the biggest advantage for the Coverdell over the 529 plans when examining education plans? A. The education expenses that the Coverdell can cover range from K - 12 through college or post secondary education. B. The education expenses that the 529 plans can cover range from K - 12 through college or post secondary education. C. The education expenses are always cheaper with the Coverdell plan. D. There are more annual limits for contributions under the 529 plan. E. There are more income limits for qualifying to make contributions under the 529 plan.

The education expenses that the Coverdell can cover range from K - 12 through college or post secondary education.

According to the video, a (n) ____________ is the amount by which actual spending *exceeds* planned spending

deficit

After putting your financial plan to work, you should periodically review and revise your plan, especially if you have all of the following, *except*: A. Get married B. Develop your goals C. Birth of a child D. Get divorced E. Spouse returns to school

develop your goals

The variable that you are solving for in a future value of a lump sum problem is:

future value

A ____ should be used to keep records that you need on a regular basis and documents with limited value

home file

The variables in a future value of an annuity problem include all of the following, *except*: A. risk tolerance B. time period C. interest rate D. payments

risk tolerance

The ____ ratio compares your liquid assets to your current liabilities.

current

The variables in a present value of an annuity problem include all of the following, *except*: A. future value B. time period C. interest rate D. payments

future value

The primary goal of the Users in the Financial system is to:

obtain funds for the least cost (or lowest interest rate)

The variables in a present value of a lump sum problem include all of the following, *except*: A. present value B. time period C. interest rate D. payments

payments

The variable that you are solving for in a present value of a lump sum problem is:

present value

According to the video, what is the second step in preparing a personal balance sheet?

to list your liabilities

A goal that would be considered measurable would be: A. Pay off student debt B. Plan a new vacation that costs $1,000 C. Save for a new car D. Saving $200 per month E. Reducing dining out to provide money for savings

Saving $200 per month

The "Paralysis of Analysis" means:

Spending so much time creating a plan that you never put it into action