Money Matters B Final Exam
Carlos would like to start saving for his son's college expenses. Which type of savings account should Carlos open? IDA money market 529 plan basic savings account
529 Plan
Rule of 72 is a formula that helps you calculate how much money you will have in your account in 72 months. True False
False
Written goals should be simple and short. True False
False
One month ago, Kyle made a goal to save $800 for a new video camera. The deadline is in seven months. He now has $110 saved. Evaluate his progress toward reaching his goal. Is Kyle on track to reach his goal? Yes No
Yes
An account that earns a higher rate of interest when you make large deposits is _____. an IDA a basic savings account a money market a savings account at a credit union
a money market
Each of these is a retirement account, except _____. an IRA a mutual fund a 401(k) a 403(b)
a mutual fund
When prioritizing goals, how should you order them? by cost in alphabetical order by how long they take to achieve in order of importance
in order of importance
The first step in setting goals is _____. calculating your net worth evaluating your long-term goals evaluating your short-term goals memorizing your goals
calculating your net worth
Erik bought a savings bond. He could have invested in a mutual fund and earned 2 percent more. The 2 percent he could have earned is the _____. opportunity cost rate of return liquidity diversification
opportunity cost
Naomi is sixteen and she would like to open a savings account. What should she do?
1. Gather information needed to open an account - DOB - SS number - home address - phone number 2. Choose a parent to be director account. 3. Go to bank and sign forms. 4. Fill out deposit form and deposit the least amount of money.
Choose all that apply. Ethan has set a long-term financial goal to own a coffee shop in ten years. He should break this goal into short-term goals. Which of the following goals is a good and useful short-term goal? I will earn a college degree in business from University of Vermont by the time I am twenty-two years old. I will save $100,000 in ten years. I will save $2,600 in one year by depositing $50 dollars per week in a savings account. I will save $100 per paycheck. I will attend college.
I will earn a college degree in business from University of Vermont by the time I am twenty-two years old. I will save $2,600 in one year by depositing $50 dollars per week in a savings account.
Nicole wants to purchase an expensive birthday gift for her mother. She will need to save $200 over the next four months. Write a goal for her.
Nicole will save $200 for her mom's present by saving $50 a week for 4 weeks.
A process for making financial decisions is called _____. PACE DEPAC PASTE PACED
PACED
Decide whether the following sources are reliable or unreliable. information from your credit union about car loans: www.fueleconomy.gov: a Web site selling financial services: a book written in 1978 about tax laws: television show that features financial experts: person on the IRS-sponsored tax hotline:
reliable reliable unreliable unreliable reliable reliable
Emily, a college student, reads an article in Money magazine. The author has a degree in finance. The article is about getting a home equity loan. This information is _____. reliable and relevant unreliable and relevant reliable but irrelevant unreliable and irrelevant
reliable but irrelevant
When selecting a savings account, you should look at the following factors except _____. annual percentage yield (APY) fees minimum balance interest thresholds taxes paid on the interest variable interest rates
taxes paid on the interest
Anne is comparing savings accounts. One account has an interest rate of 1.2 percent compounded yearly, and one account has an interest rate of 1.2 percent compounded monthly. Which account will earn more money in interest? the account that earns 1.2 percent compounded yearly the account that earns 1.2 percent compounded monthly
the account that earns 1.2 percent compounded monthly
Amelia has her money in a CD earning 2 percent interest. How long will it take for her money to double? seventy-two years thirty-six years twenty-four years eighteen years
thirty-six years