Econ unit 7
What is one of the opportunity costs of attending college?
. The money spent on tuition could've been invested in stocks or bonds.
Put the steps in the correct order to show how to put together a personal budget.
1. Add up all of your sources of income. 2. Figure out how much money you're spending. 3. Categorize your expenses to show where your spending goes. 4. Determine if your spending is below your income. 5. Reduce expenses in flexible categories to save or increase savings.
Put the steps in the correct order to show how a budget is made.
1. Calculate income. 2. Write down expenses. 3. Compare expenses and income. 4. Reduce expenses if necessary
Which of the following does not protect consumers?
A boycott
What is most similar to a generic good?
A brand-name good
What is most similar to a brand-name product?
A generic product
Which of these makes it easier for a person to get a credit card?
A good credit history
What kind of contract outlines the obligations of a landlord and his or her renters?
A lease
Using an amortization table gives you information about what?
A loan
Which of these helps you avoid debt by keeping your expenses below your income?
A personal budget
Which of these can be used to protect consumers from unsafe products?
A recall
What makes a savings account a better investment than a checking account?
A savings account earns interest.
Which of these protects customers who purchase defective product
A warranty
How can consumers get the government to pass laws preventing companies from engaging in offensive behaviors?
By lobbying
Which of these fees is the biggest problem for customers who need to use their credit card to take money from an ATM?
Cash advance fee
Why do people come to different decisions using cost-benefit analysis even under the same conditions?
Costs and benefits are both subjective.
Why do economic decisions vary from person to person even under the same circumstances?
Costs and benefits are subjective
Which of these most accurately describes the costs and benefits of using a credit card?
Credit cards are convenient but can result in debt
Maintaining a good credit history makes it easier to do what?
Get a loan
What is the annual percentage rate (APR) on a credit card?
The amount of interest charged on unpaid balances
What does it take for a consumer boycott to be successful?
The boycott must significantly reduce the target company's profits.
What provides collateral to secure a car loan?
The car
Why might a letter-writing campaign get a company to change its business practices?
The company might fear that the letter-writing campaign will become a boycott if it doesn't respond.
Why does attending college involve an opportunity cost?
The money spent on tuition cannot be invested in another way.
What is the grace period on a credit card?
The number of days the customer can wait to pay for purchases without being charged interest
What does an amortization table show?
The principle and interest being paid on a loan
What is a cash advance?
The use of a credit card to take money from an ATM
Which of these states one of the opportunity costs of attending college?
Time spent on schoolwork takes away from the chance to earn money at a job.
Why do some auto insurance customers want medical coverage for their policies?
To avoid having to pay for hospital bills resulting from an accident they cause
What is the purpose of a letter-writing campaign conducted by a group of consumers?
To get a company to change its business practices voluntarily
What's the main reason to use a personal budget?
To stay out of debt
Which of these is an example of luxury spending?
Travel
Which of these is an example of discretionary spending?
Vacation
Under what circumstances do people have to make a co-pay?
When they go to a doctor because of an illness
Which of these describes a situation in which people have to make a co-pay?
When they visit a doctor
When is liability insurance needed?
When you cause an accident that damages another vehicle or hurts someone
Why does a credit card make it easy to go into debt?
You can buy something before you have enough money to pay for it.
What makes a checking account more convenient than a savings account?
You can spend your money without having to withdraw cash first.
Which of these allows you to buy something without waiting until you have the money?
credit card
What does a good credit history do for consumers?
makes it easier for them to get loans.
Because subjective decisions are based on a person's unique values and beliefs, economic decisions _________________
vary from person to person
Put the steps in the correct order to show how to put together a personal budget.
1. Total your income. 2. Figure out how much money you are spending. 3. Categorize your expenses to show where your money goes. 4. Determine if your expenses are above or below your income. 5. Reduce expenses in flexible categories to save or increase savings
A. Minimum balance fee B. Annual fee C. Co-pay
A. Checking account C. Health insurance B. Credit card
Which of these shows how a loan is paid by listing the principle and interest associated with each payment?
An amortization table
A. Balance transfer fee B. Non-sufficient funds fee C. Deductible D. Mortgage payment
B. Checking account C. Health insurance A. Credit card D. Home loan
A. Collision coverage B. Renter's insurance C. Disability insurance D. Fee-for-service insurance
B. When your personal possessions are stolen from your apartment C. When you lose your job because of an injury or illness A. When your car is damaged in an accident you cause D. When you want to choose your own doctor or hospital
A. Uninsured motorists coverage B. Homeowner's insurance C. Disability insurance D. Managed-care coverage
C. When you have to take a month off from work because of an injury or illness D. When you need to visit a doctor about an illness A. When your car is damaged by someone who has no auto insurance B. When your house and possessions are destroyed by a fire
Which of these allows someone to buy a car that costs more than he or she can afford?
Car loan
A socially responsible consumer might boycott a company that uses what?
Child labor
Which of these describes the costs and benefits of taking a college loan?
College loans help increase future earning power but result in a long-term commitment to monthly payments.
A. Non-sufficient funds fee B. Cash advance fee C. Co-pay D. Interest payment
D. Mortgage C. Health insurance B. Credit card A. Checking account
A. Life insurance B. Renter's insurance C. Disability insurance D. Liability insurance
D. When you cause a car accident that injures other people C. When you have to take a month off from work because of an injury or illness B. When your personal possessions are stolen from your apartment A. When you want to provide for your family after you die
What do banks do with some of the profits they make by loaning out the money in their customers' savings accounts?
Pay interest on savings accounts
What is a bank customer's share of the profits made on loans?
Savings account interest
What's the difference between a brand-name and a generic product?
The company that sells the product
What are you paying for when you lease a car?
The decrease in the car's value
Why might a company respond to a letter-writing campaign launched by a group of concerned consumers?
The letters contain a veiled threat that economic pressure could follow.
What do leases contain?
The obligations of renters and landlords
Which of these describes a situation in which people have to pay a deductible?
When their insurance policy only covers part of a medical expense
What do banks pay to their savings account customers?
Interest
What makes a credit card more convenient than a debit card?
It can be used to buy things without immediate payment.
Which of these might result in the government passing a law preventing companies from engaging in unfair or offensive business practices?
Lobbying
Why does a savings account make a better investment than a checking account?
Savings accounts earn interest.
What kind of customer would want collision coverage for his or her auto insurance?
Someone concerned about causing damage to his or her own car
Using a budget is a good way to what?
Stay out of debt
What is one of the primary concerns of socially responsible consumers?
Sustainability
participating in a boycott often involves a sacrifice because the boycotters end up doing what?
Paying higher prices
Why do consumers have influence over politicians?
Politicians rely on the votes of consumers to keep them in office.
Which of these would a socially responsible company use?
Renewable resources
Which of these is an example of a fixed expense?
Rent
Which of these credit card features would be best for customers who want to pay off the balance on a high-interest credit card?
Low fees for balance transfers
Which of these describes the costs and benefits of getting a mortgage?
Mortgages enable people to buy houses but result in large interest payments.
A boycott would not be successful under what circumstance?
Most consumers didn't stay away from the company.
What does a lease outline?
Obligations of renters and landlords
What kind of a credit card can customers with a bad credit history get?
One that's secured by collateral
