Financial Exam

Tonya's grandmother loaned her $2,000 to help make the down payment on a used car. Tonya agreed to pay 5% simple interest on the loan and would replay the loan in 24 months. What is the total amount of interest Tonya will pay for the loan?

$200

Deskin is borrowing $3,600 from his aunt at a simple interest rate of nine percent per year. Deskin's aunt expects him to repay her the principal plus interest at the end of that year. What is the maturity value of the loan?

$3,924

Gene wanted to invest his money. He found one that compounded interest every 3 months at 17%. He decides that he will invest for two years. If Gene invests $5,000, how much will he have after two years?

$6,975.55

The amount of interest you earn in a typical savings account is about

1 percent

If you are 17 right now, what is the best age to begin investing?

17

Which of the following is an advantage of using an online brokerage firm:

24 hour account access

On jan 3, Anna mailed her credit-card payment, which was due in jan 5. The credit-card issuer received the payment on jan 7. What most likely appeared on Anna's credit card statement the following month?

A late fee

Patrick wants to keep a certain amount of his money in a safe place in which he can earn interest in his savings, and also be able to withdraw his funds without experiencing sizable financial penalties. In what type of financial institution should Patrick consider placing his money?

A retail bank

When should you record bank transactions in your check register?

As soon as each check is written

What is the first step Cameron should take to protect himself from identity theft after he loses his wallet?

Cancel all of his credit and debit cards

Which of the following is a common error found on credit card bills:

Charges for returned items that have not been credited to the account

Honest goal setting usually helps you to______your priorities

Clarify

Governments pay for public services such as police protection, road repairs, and public education by

Collecting taxes

Which of the following is a type of financial-services provider:

Commercial bank

Which of the following should you do first when you question the accuracy of a utility bill:

Compare the meter readings with those shown on the bill

Which of the following is a possible consequence of having one's identity stolen:

Damage to credit history

One of the benefits to some individuals of using Form 1040 to file their personal income tax is that this form enables them to

Deduct allowable expenses

Which of the following is a financial want rather than a need?

Education

Which of the following is a cost of credit?

Finance charges

The major reason people fail to reach their goals is that they

Give up too soon

What is an example of good debt?

Having your children take out loans for college

A business advertised new-product financing with a 10 percent down payment and a low interest rate with monthly payments spread over four years. What type of loan was the business offering?

Installment loan

Which of the following helps individuals select the type of life insurance to buy and the most appropriate investments:

Local bank managers

After Mrs. Green provided the cashier with $2.50 in cash and coins, she left with a gallon of milk. In this situation, money is being used as a

Medium of exchange

Which of the following is one of the functions of money:

Medium of exchange

What is associated with every choice you make due to limited resources?

Opportunity cost

Which of the following is generally the least expensive way to pay bills online:

Paying your accounts at the billers' web sites

Which of the following records should individuals keep that contains information about their investments:

Purchase

The following is written on the back of a check: "For deposit only; María Evans; Account #285655." This is an example of an______endorsement.

Restrictive

Which type of credit account gives the customer a credit limit at the time the account is opened and allows the customer to make payments over a period of time or to pay off the total amount due each month?

Revolving

An overall purpose of establishing goals is to increase your chances of

Satisfying your wants

What type of loan requires collateral?

Secured

What is a top to aid in paying bills on time?

Set aside two times a month to pay bills

One way to reduce the risk of identity theft is by

Shredding old bank statements

For which if he following items would you save for, rather than invest:

Spring break

Matt is balancing his checkbook for the first time. He compares the checks he has written over the last month with those listed of his statement and finds that all of his checks have cleared. Next, he verified that his latest paycheck, which he deposited the previous day, is on the list. Is it not, so he adds it to his statement balance. After this, he should

Subtract fees and charges

When preparing a personal income tax form, parents report some of their childcare expenses to receive

Tax deductions

How do buyers and sellers benefit when they're matched up by financial institutions?

The costs of finding each other are lowered

Why should you spell out the check amount when completing checks?

The spelled out check amount is used if the numbers are unclear

How do limited resources impact self-discipline in money management?

They require you to make choices about whether to save if spent you money

What is good advice to follow to avoid excessive debt?

Think long term and be realistic about income and expenses

A step in choosing a goal is selecting a______for the goal.

Time limit

Why is it important to read and reconcile bank statements?

To balance an account

Why do you need to understand the role of institutions?

To be better positioned to assess proposed changes to them

When Armand is comparing his checkbook balance with his bank statement, he must make sure that he has subtracted the______from his checkbook.

Transaction fees

Chris is at the grocery store deciding between two very similar candy bars. One is $1.50, and the other is $3.00. He decides to buy the $1.50 candy bar because it is cheaper. Chris is using money as a______to make his decision.

Unit of measure

One way money functions in society is that it helps people communicate a product's

Value

What is likely to be the result if you fail to set goals?

You will waste a lot of time and effort

Which of the following explains what credit is:

an arrangement to buy now, pay later

An advantage to businesses of offering credit is that customers

are not as price-conscious as cash customers

Caitlin has three credit cards. She receives her credit-card statement for one of the cards and has to decide how the pay the $500 she spent with that card. To pay the least for use of the credit, she should pay with______and make the______payment.

cash; full

Reconciling a personal bank statement is the process of determining any differences between the bank statement balance and the

checkbook balance

One of the reasons that businesses and customers use credit is because it provides

convenience

Chloe is preparing her income tax return for the first time. She is a receptionist, does not own any land or real estate, and has not inherited any money from a deceased relative within the last tax year. She will only be taxed on

earnings

Individuals charging only the amount they can afford to pay in full every month is an example of

the wise use of credit

An amount of money borrowed by an individual or a business simply by signing a promissory note is obtaining an

unsecured loan