Burnett, Briahna 7- Money Matters- ACC Review
With the completion of a bachelor's degree one can expect to earn - in income over a 40 year period.
$2.5 million
Jamie McFarland has determined that the value of her liquid assets is $4,500, the value of her real estate is $128,000, the value of her personal possessions is $62,000, and the value of her investment assets is $73,000. She has also determined the value of her current liabilities is $7,500 and the value of her long-term liabilities is $98,000. What is the total value of her debts?
$105,500
The all-Star Basic Value Fund's portfolio is valued at $210 million. The fund has liabilities of $5 million and the investment company sponsoring the fund has issued 16.4 million shares. What is the fund's net asset value?
$12.50
Shelly Sanders gets a loan for $3,000 and repays the loan in 12 months of $258 per month. Under the rule of 78, what is the amount of interest included in her first month?
$14.7
Randal Ice is 57 years old and has an adjusted gross income of $32,000. He has medical expenses for the year of $6,000. How much of these expenses can he deduct from adjusted gross income?
$2,800
At a 3% inflation rate, appx how many years will it take for prices to double?
24 years
Joan Sanchez is single and earns $40,000 in taxable income. She uses the following tax rate schedule to calculate the taxes she owes.
25%
If a new car loan costs 6%, a used car loan would cost appx - %.
7%
What is the current yield for a $1,000 corporate bond that bond that pays 7% and has a current market value $800?
8.75%
In recent year, appx what percent of new jobs in the U.S. economy occurred in companies with fewer that 100 employees?
80
An example of an indirect real estat investment is
A real estate investment trust
The 2001 CSO table separates the mortality experience by
Age
Which of the following are considered to be personal financial statements?
Balance sheet and cash flow statement
Which type of bond in not registered in the investor's name?
Bearer
Stock dividends are determined by the
Board of directors
Recently, Jim Dahl was on a bus tour in a mountainous area. The bus broke down forcing the group to stay overnight. Group members had to pay for their own hotel bills. Jim believes that the hotel cost for the group should be paid by the tour company. Which legal action would be most appropriate?
Class action suit
Sophie Bennett has personally paid a total of $5,000 in medical costs this year. At this point, there is a clause in her insurance contract the requires her insurance company to pay 100% of her medical costs for the remainder of the year. What clause is this likely to be?
Coinsurance
You can often obtain medium-priced loans from
Commercial banks and credit unions
Which of the following types of financial institutions provide FDIC coverage?
Commercial banks, credit unions, and savings and loans
Garrett Jennings is thinking about buying an investment that represents the most basic form of business ownership and pays a dividend. The dividend on this investment is paid after all other payments and dividends have been made. Which investment is Garrett thinking about purchasing?
Common stock
Which one of the following is a local organization that provides debt counseling services for families and individuals?
Comsumer Credit Counseling Servic
What is the most popular type of home ownership?
Condo
Nathaniel Drummond has 3 different insurance policies. He has been injured in an accident and has incurred $30,000 in medical bills. There is a clause in all of his insurance contracts that ensures he receives no more than a total of $30,000 in payments from his insurance companies. what is this clause called?
Coordination of benefits
Jeremiah Brown has been making contributions to an individual retirement account to help pay for his children to go to college. Which type of account is he most likely using?
Coverdell Education Savings Account OR Roth IRA
Sam Waterston has been making contributions to an individual retirement account to help pay for his children to go to college. Which type of account is he most likely using?
Coverdell Education Savings Account OR Roth IRA
To calculate dividend yield, the annual dividend amount per share is divided by the -per share
Current stock price
The study of how wealth is created and distributed is
Economics
Which one of the following provides for the disposition of your assets and is usually prepared with an attorney's assistance?
Formal will
If you put $1,000 in a savings account and make no further deposits, what type of calculation would provide you with the value of the account in 20 years?
Future value of a single amount
Lynn Roy owns 3 two-karat diamonds hat she received from her grandmother who did not believe in banks, stocks, or bonds. What type of investment does she hold?
Gems
A prime reason for buying an annuity is to
Give you retirement income for the rest of your life
Louise Prescott is buying shares in a mutual fund that invests in companies expecting higher than average revenues and earning growth. what type of mutual fund is she buying?
Growth fund
All of the following statements are considered to be good advice for a potential investor starting an investment program except
Increase credit purchases to conserve cash
Under what type of ownership is the property considered owned 50/50 for estate tax purposes and passed automatically to your spouse?
Joint tenants with the right of survivorship
The basic unit of gold bullion is one
Kilogram
If a bond is purchased at a price above the face value, the yield to maturity is
Less than th stateed interest rte
Ashley Riley wants to buy the stock of XYZ Company at a specific price. What type of order should she place?
Limit order
Which of the following would most likely be classified as a current liability?
Monthly balance due on a credit card
Sandra Peterson has been thinking about investin in corporate bonds. She is concerned about safety and wants the most secure bond investment possible. She would likely invest in - bonds.
Mortgage
Why are a growing number of students without health insurance?
Older students are not covered by family policies
Steve Black has two children. He is buying each of them their own TV to put in their rooms so they do not have to join the rest of the family and watch TV together. Which one of the answers best explains Steve's spending?
Overindulgence of children
Hospital insurance is which part of Medicare?
Part A
Albert Finney owns a home in Pompano Beach, Florida. His house is broken into and the burglar steals his computer, his big screen TV, his stereo equipment, and his toaster. What part of his homeowner's insurance would cover this loss?
Personal property
A high-tech scam that uses spam or pop-up messages to deceive you into revealing your credit card number, bank account information, social security number, passwords, or other sensitive information is called
Phishing
A mutual fund
Pools the money of many investors- its shareholders- to invest in a variety of securities
Which CD attempts to attracts savers with gifts or special rates?
Promotional
- protects you against financial loss when your car damages the property of others.
Property damage liability
A cost associated with home buying would be
Property tax
An example of a direct real estate investment is a
Real estate dwelling
The purpose of zoning laws is to
Restrict property use
The purpose of a rate cap with an adjustable rate mortgage is to
Restrict the amount by which the interest rate can increase
A cost associated with renting would be
Security deposti
A cooperative is designed to
Sell products or services to members at reduced prices
Which will is sufficient for most smaller estates?
Simple
Federal tax-deferred employee benefit are
Taxed at some future time
An example of a personal opportunity would be
Time comparing several brands of personal computers
Which of the following statements is false?
To date, it is impossible to determine corporate earnings by using the internet
What should you do when an HMO denies treatment or coverage?
You should do everything included in the other answers
Your bank statement shows a balance of $670. Your checkbook register shows a balance of $462. You earned interest of $2 and have a service charge of $4. There are no outstanding deposits. What is the amount of outstanding checks?
$210
Your annual income is $50,000. What is your life insurance need based on the easy method?
$245,000
The main purpose of Consumers Union is to
Evaluate the quality of products and services
What type of annuity is generally purchased by people of retirement age?
Immediate annuity
Which of the following features does not accurately describe a line of credit?
Long-term loan
The purpose of screening interview is to
Reduce the number of applicants for a job
Which one of the following investments offers the greatest liquidity?
Savings account
You can determine your net worth by
Subtracting your liabilities from your assets
Patricia McDonald has determined that the value of her liquid assets is $4,500, the value of her real estate is $12,000, the value of her personal possessions is $62,000, and the value of her investment assets is $73,000. She has also determined the value of her current liabilities is $7,500 and the value of her long term liabilities is $98,000. She What is Patricia's newt worth?
$162,000
Katherine Kocher has determined the following information about her own financial situation. Her checking account is worth $850 and her savings account is worth $1,200. She owns her own home that has a market value of $98,000. She has a furniture and appliances worth $12,000 and a home computer and laptop worth $3,300. She has a car worth $12,5000. She has recently purchased a 2-year certificate or deposit worth $5,500 and she has a retirement account worth $38,550. What is the total value of her assets?
$171,900
If your monthly net income is $1,500, what would be your maximum amount spent on credit payments?
$300
A $1,000 corporate bond is convertible to 25 shares of the corporation's common stock. What is the minimum price that the stock must obtain before bondholders ould considr converting the bond to stock?
$40
An online buying club requires an annual fee of $60 in order to qualify for 15% discount on purchases. What amount would a person have to buy in order to save enough to cover the cost of the membership?
$4000
A $1,000 corporate bond pays 6.5% a year. What is the annual interest you will receive?
$65
Using the "nonworking" spouse method, what should the life insurance need be for a family whose youngest child is 10 years old?
$80,000
Up to how many days of skilled nursing care are covered by Medicare?
100
A taxpayer with a taxable income of $47,856 and a total tax bill of $5,889 would have an average tax rate of - percent?
12.3
According to the 2012 Trustees Report, in what year is it projected that the funds available for paying Social Security benefits will be exhausted at current benefit and taxes?
2033
The Affordable Health Act of 2010 requires new health plans to allow young people to remain on their parents' insurance policy until what age?
26
This morning, you received a phone call regarding a debt you allegedly owe. If you dispute this debt, you must write to the debt collector and request verification anf the obligation. How many days do you have to send this letter?
30
Appx how many credit card users would be classified as "convenience users" who generally pay off their balances in full each month?
33%
What percent of Americans ages 65 to 74 are still in the workforce?
41
In a marriage that lasts more than 15 years, there is generally a - split of the marital assets.
50/50
Which of the following would qualify a person for an exemption when computing taxable income?
A dependent
The most reliable source of product information i likely to come from
A food product ingredient label
Martin Campbell wants to invest in mutual funds, but is also worried about diversification. Which fund would you recommend to him?
A fund of funds
A closed-end fund is
A fund whose shares are issued by an investment company only when the fund is organized
Karen is notified by her credit card company that the credit limit on her credit card has just been increased to $10,000. this is one example of a change related to
A kline of credit
Nick Boss has a savings account with $550 in it. He knows that can withdraw this money whenever he wishes. This would be an example of
A liquid assest
Higher interest rates can be caused by
A lower money supply
If creditors add finance charges after subtracting payments made during the billing period, this is called the
Adjusted balance method
The stages that an individual goes through based on age, financial needs, and family situation is called the
Adult life cycle
Which of the following is typically considered to be a personal financial record?
All of these
A major activity in the planning component of financial planning is
Allocating current resources for spending
The reduction of a loan balance through payment made over a period of time is called
Amortization
A system that requires each insurance company operating in a state to provide coverage to individuals who have been unable to obtain other insurance is referred to as
An assigned risk pool
Kyle Burroughs has decided to put $25 more per week in his savings account. He knows this will reduce his ability to go out to eat each week but thinks building his savings is important. This would be an example of
An opportunity cost
Private label products are those that
Are sold by one chain of stores
Which one of the following would NOT be a good use of a home equity loan?
Buying a new boat
A type of employee benefits program that allows workers to base their job on a credit system and personal needs is called
Cafeteria-syle
The debt payments-to-income ration is
Calculated by dividing monthly debt payments by net monthly income
In 2011, which country was the world's largest producer of gold?
China
A - resume presents a person's education, work experience, and other information in a reverse time-sequence.
Chronological
Georgia Owen was in an accident in which her car was totaled. What part of Georgia's automobile insurance would cover the damage to her car?
Collision
Which type of credit insurance repays your debt in the event of a loss of income due to illness or injury?
Credit accident and health incurance
Not included in the recent tax credits is a/an - tax credit.
Credit card
Contingent deferred sales loads generally
Decline gradually until there is no withdrawal fee
Anthony Edwards wants to diversify his portfolio by adding a stock that maintains a stable value when the economy declines. What type of stock does Anthony want to add to his portfolio?
Defensive stock
Health insurance includes
Disability insurance
A surgeon who will soon finish paying off college loans might what to set up a(n)
Disclaimer trust
Terry Hamilton just received $30,000 from an uncle who died and is trying to decide how to invest it. She has done some research and has decided that about 30% of the money should go into large cap stocks, 20% into medium cap stocks, 15% into small cap stocks, 10% into foreign stocks, and 15% into cash. She thinks that even if one area does not do that well, the rest will so that her overall return will be pretty good. What aspect of investing is Terry most concerned about?
Diversification
Scott Cumbie believe he has a "typical" family and wants to determine his life insurance need. What method would be the fastest method for him to use to calculate his insurance need?
Easy method
Marcia Fuller has an insurance policy that lists that she and her 3 daughters, ages 6, 10, and 12, are covered under this policy. Which provision in her insurance policy is defined by this list?
Eligibility
Which federal law sets the minimum standards for pension plans in private industry and protects more than 50 millions workers?
Employee Retirement Income Security Act
Jane Calvert owns a condo at the beach which she rents out to vacationers. What type of investment does she hold?
Equity REIT
Which one of the following is not a recommended step individuals can use to weather a future financial crisis?
Establish a smaller than usual emergency fund
What type of tax is imposed on the value of an individual's property at the time of his or her death?
Estate
Maryellen Epplin worked in Poland for part of the year and earned $50,000 while she was there. This income will not be included in her taxable income for the year. This represents a tax
Exclusion
All the different fees and fund operating costs are often referred to as a(n)
Expense ratio
A decrease in net worth could be the result of
Expenses exceeding income for a month
Payday, cash advance, check advance, and postdated checks are - loans.
Expensive
Negligence refers to
Failure to take ordinary and reasonable care
Which federal law protects you by requiring credit bureaus to furnish correct and complete information to creditors?
Fair Credit Reporting Act
Jeff Willis has 5 kids and more debt than the average family. What method would probably be the best method for him to use to calculate his insurance needs?
Family need method
When one investment company manages a group of mutual funds, it is called a(n)
Family of funds
The total dollar amount you pay to use credit is called the
Finance charge
A contract stating that the annuitant will receive a constant amount of income over a certain period or for life is called a
Fixed annuity
In general, the price of gold
Fluctuates daily
Defective house wiring is an example of a
Hazard
Which one of the following expenditures for retirees is most likely to increase?
Health care
Which one of the following is not a provider of health insurance?
Health insurance industry association
For which of the following types of credit plans is the interest tax deductible?
Home equity loan
More people have - insurance than any other kind of health insurance.
Hospital expense
Chris Jones has an insurance policy that pays benefits in cash when he is hospitalized. What type of insurance would this be?
Hospital indemnity
If overall interest rates in the economy fall, a corporate bond with a fixed interest rate will generally
Increased in alue
Which of the following is an example of an industrial trend that could affect the job market?
Increased use of computers in manufacturing
Real property equity investments are usually considered attractive during times of
Inflation
When a corporation sells stock to the general public for the first time, it is referred to as a(n)
Initial public offering
The changing cost of money is referred as - risk.
Interest rate
Kyle Burroughs has purchased a suit and has interviewed with 3 companies through the career placement center at his university. He was surprised by some of the questions asked and does not feel he answered them well. He has developed some answers that he feels are better answers and better reflects his abilities and aptitudes. Which step in the career planning process has Kyle completed?
Interview for a specific positions and assess the interview performance
The quality rating given by Standard & Poor's to highly-speculative bonds is
Investment-grade
Standard & Poor's and Value Line are companies that would be examples of
Investors' services
Equity financing is a popular choice to provide long-term financing for a corporation because
It does not have to be repaid
Which of the following is not a true statement about a holographic will?
It is handwritten
Which statement is not true about a formal will?
It is usually prepared without an attorney's assistance
Kate plans to rent instead of buying her housing. Which advantage of renting will she realize?
Lower initial costs
- is considered a variable operating expense of an automobile.
Maintenance
Which one of the following is a correct statement about the nation's health care system?
Many Americans are unhappy with ouit healthcare system
Which of the following attributes would not b used by an underwriter to determine appropriate premiums to charge for insurance?
Marital status
Which of the following is not a social factor that would influence a consumer buyer's decision?
Marital staus
A common criticism of including a career objective on a resume is that it
May be too vague
Which type of hone is most apt to depreciate in value?
Mobile home
Which of the following institutions is organized primarily to provide loans to purchase homes?
Mortgage company
Which one of the following statements is false?
Most individual investors that purchase Treasury bills, notes, and bonds bid competitively
Which one of these investments pools the funds of many investors and hired and professional money manager to manage those funds?
Mutual funds
The value of a mutual fund's portfolio minus the mutual fund's liabilities, divided by the number of shares outstanding is called the
Net asset value
What does it mean to sublet an apartment?
Obtain another tenant to complete a lease period
Attempts to increase income are part of the - component of financial planning
Obtaining
For an entry-level position, a person'e resume is likely to be
One page
Alex Bates goes on Jeopardy and earns $875,000 in winnings. What type of income is this?
Other income
Which one of the following would not be considered personal property by a homeowner's insurance policy?
Outside deck
Jennifer Ryan wants to gain some employment experience so when she is ready to start a career she has something to offer a company. She has decided to work 20 hours a week for a local accounting firm answering the phone and assisting the partners in completing tax returns. Which of the following employment experience strategies is she pursuing?
Part-time employment
If you want a risk-proof real estate investment, invest in
Participation certificates
To avoid high fees for loans, a person should avoid borrowing from a
Pawnshop
Which of the following institutions makes loans based on the value of tangible possessions, such as jewelry and collectibles?
Pawnshop
Neil Guest writes writes a check to pay for daycare for his son. What type of financial service is Neil using?
Payment service
Jeremy Fischer has just purchased 20 American eagle gold coins from a broker. What type of investment does he hold?
Precious metals
A documentary agreement between spouses before marriage in which one or both parties often waive the right to receive property under the other's will of under state law is called a
Prenuptial agreement
What type of computation would a person use to determine current value of a desired amountfor the future?
Presen value of a single amount
Which of the following expenses is paid from an escrow account?
Property insurance or property tax
An investment company sponsoring a mutual fund must give potential investors a(n)
Prospectus
A person's net worth would increase as a result of
Reduced amount owed to others
Francesca Brown has a life insurance policy that provides her with protection for the next 5 years. However, she can get 5 more years of protection at the end of this term without having to have a medical examination because she will be less than 70 years old at that time. Her premiums will rise during each 5-year period. What type of insurance does Francesca likely have?
Renewable
A limit on the amount you must keep on deposit in order to earn interest or avoid a service charge is an example of a(n)
Restriction
Most consumer complaints are resolved by
Returning to the place of purchase
An emergency fund should be deposited in a
Savings account at the highest available interest rate
Time deposits are another name for
Savings accounts
Itemized deductions are recorded on
Schedule A
When interest rates are rising, a person would best be served by
Short-term saving instruments
Matthew Miller has created a will and left everything to his wife Kate. What type of will has he created?
Simple
Kelly and Bob Walton recently purchase d a new home and desire coverage for all causes of loss or damage except those specifically excluded by the policy. They should obtain - for of the homeowner's policy.
Special
One aspect of financial planning is to make wise decisions as to what to purchase and when to purchase it. Which aspect of financial planning does this deal with?
Spending
James Fitzwater has created a will that leaves exactly $2 million to his wife. What type of will has James created?
State dollar amount
Valerie Kilmer owns stock in the Williams Widget Company. She was just advised that in the near future she will be receiving two shares for every one share she owns today. What has the company declared that will cause this chance to her shares?
Stock split
An unauthorized person who obtains a credit report under false pretenses may be
Subject to a fine and imprisonment
A type of bond that is unsecured and gives bondholders a claim secondary to that of other designated bondholders with respect to both income and assets is called a
Subordinated debenture
The - coverage of a home insurance policy would cover accidental damage to another person's property by a member of your family.
Supplementary
Sam Waters just received $10,000 from his grandmother's estate. He has thought about buying himself a new Harley with the money but has decided instead to add the money too his mutual fund account. Which suggestion for obtaining the money he needs for investing is he following/
Taking advantage of gifts, inheritance and other windfalls
Mr. and Mrs. Keating want to give their son Dudley a total of $24,000. They each write him a check for $12,000 so they won't have to pay any gift tax. This is an example of
Tax avoidance
Which of the following i a benefit on which you pay taxes at some future date?
Tax-deferred benefit
In what type of joint ownership may neither spouse sell the property without the consent of the other?
Tenancy by the entirety
If there is incorrect information in your credit file
The credit bureau must reinvestigate and modify or remove incorrect information
Which statement is not true about no-fault insurance systems?
They are intended to reduce the time and cost associated with the settlement of automobile injury cases
A - is financially independent firm that acts as the bondholder's representative.
Trustee
The easy method of determining life insurance requirements assumes that your family is
Typical
If Widget Corp. has a PEG value of .5, the stock is most likely
Undervalued based on its poor historical earnings
Which organization specializes in the testing of products for electrical and fire safety?
Underwriters Laboraties
The "head of household" filing status is for people who are
Unmarried and have dependent hildren
Which type of risk affects only a specific company or a specific industry?
Unsystematic
Federal Trade Commission regulations require that
Used car buyers be informed of whether or not the vehicle comes with a warranty
Which of the following professional advisory services may charge a fee for you to access the more detailed information that may be needed to evaluate a stock investment?
Value Line and Morningstar
