Personal Finance Final Review

Which of the following would not be included in a person's listing of assets? A) $13,000 car loan B) $300 cash on hand C) $5,000 dinette set D) $1,000 in savings account

A) $13,000 car loan

Which of the following laws grants you the right to know what is in your credit file? A) Fair Credit Reporting Act B) Truth-in-Lending Act C) Credit Card Act of 2009 D) Fair Credit Billing Act

A) Fair Credit Reporting Act

A property tax is based on the property's A) assessed value B) original cost C) market value D) none of these

A) assessed value

When reconciling a bank statement, the amount of outstanding checks is A) deducted from the bank statement balance B) added to the bank statement balance C) deducted from the checkbook register balance D) added to the checkbook register balance

A) deducted from the bank statement balance

Which of the following is the most liquid? A) savings account B) money market account C) certificate of deposit D) savings bond

A) savings account

Which of the following laws limits a person's liability to $50 after a credit card has been reported lost or stolen? A) Fair Credit Reporting Act B) Truth-in-Lending Act C) Credit Card Act of 2009 D) Fair Credit Billing Act

B) Truth-in-Lending Act

A stock split occurs when A) a dividend is paid in the form of new shares of stock B) a company issues more stock to current shareholders in some proportion to the stock they already own C) half of the outstanding common shares are bought back by the issuing company and replaced with preferred stock D) half of the outstanding preferred shares are bought back by the issuing company and replaced with corporate bonds

B) a company issues more stock to current shareholders in some proportion to the stock they already own

A utility bill is an example of A) an asset B) a variable expense C) a fixed expense D) a cash inflow

B) a variable expense

When you borrow money from your broker to buy stock, you are A) buying short B) buying on margin C) stock turning D) none of these

B) buying on margin

The amount of money a person has to spend after needs are met is called A) net cash flow B) discretionary income C) net worth D) disposable income

B) discretionary income

Which of the following is true of a payday loan? A) it is difficult to obtain B) interest and fees can be substantial C) it is a long-term loan D) none of these are true

B) interest and fees can be substantial

Which of the following is not an optional deduction from your pay? A) health insurance B) social security tax C) life insurance D) savings plan

B) social security tax

Investing is A) also referred to as deferred spending B) sometimes explained as using money to make more money C) a "pay-yourself-first" strategy D) none of these

B) sometimes explained as using money to make more money

The words "Pay to the order of" are included in which type of endorsement? A) blank endorsement B) special endorsement C) restrictive endorsement D) all of these

B) special endorsement

When you owe more on a car than it is worth, the loan is said to be A) ballooned B) upside down C) depreciated D) none of these

B) upside down

Your credit score is also known as your FICO, which stands for A) Fair Interest Credit Opportunity B) First Isaiah Corporation C) Fair Isaac Corporation D) Financial Income and Commitments Outstanding

C) Fair Isaac Corporation

The form used to report taxable income a worker received during the calendar year is A) Form 1040 B) Form 1040A C) Form W-2 D) Form W-4

C) Form W-2

Which of the following agencies has primary responsibility for setting monetary policy and regulating the banking system? A) The U.S. Department of the Treasury B) The Internal Revenue Service C) The Federal Reserve System D) The U.S. Banking and Finance Planning Commission

C) The Federal Reserve System

Your net worth can be computed as A) assets plus liabilities B) cash inflows minus cash outflows C) assets minus liabilities D) assets minus cash outflows

C) assets minus liabilities

Which of the following is considered to be a progressive tax? A) FICA B) property tax C) federal income tax D) sales tax

C) federal income tax

When a paper check is transformed into a digital image, it is said to be A) canceled B) restricted C) truncated D) transposed

C) truncated

An example of a perk is A) a prime parking space B) an office with a view C) use of a company car D) all of these

D) all of these

Late credit card payments can A) increase your interest rate B) incur penalties and additional fees C) hurt your credit score D) all of these

D) all of these

Late fees and over-the-limit fees on your credit card bill can A) each cost you $35 or more B) cause the interest rate you are charged to rise C) affect your credit score in a negative manner D) all of these

D) all of these

Which of the following is not a demand deposit in a bank? A) checking account B) savings account C) money market account D) certificate of deposit

D) certificate of deposit

Which of the following would be considered a fixed expense? A) gasoline B) clothing C) entertainment D) rent

D) rent

True or False: A personal net worth statement shows a person's cash inflows and cash outflows for a period of time.

false

True or False: A stop order advises your broker that you no longer wish him to represent you.

false

True or False: Banks will hold postdated checks and process them at the future date.

false

True or False: Forgery occurs when someone alters a check by changing its amount to obtain more money from another person's account.

false

True or False: With a restrictive endorsement, anyone who finds the endorsed check can cash it.

false

True or False: A checking account is also called a demand deposit account because the account holder may withdraw money on demand or write checks on the account at any time.

true

True or False: A good way to get started with credit is to open a checking account and get a debit card.

true

True or False: A special endorsement creates a third-party check.

true

True or False: By insuring deposits in banks, the FDIC helps to promote public confidence in the U.S. financial system.

true

True or False: Finance charges increase the cost of items purchased by a credit card.

true

True or False: Having a set amount withheld from your paycheck is a convenient way to achieve systematic savings.

true

True or False: Medicare is a government-sponsored health insurance program for senior citizens.

true

True or False: Salaried workers usually do not keep time cards or count hours worked and do not receive overtime pay.

true

True or False: Securities exchanges are auction markets.

true

True or False: Service credit is often provided by utility companies and doctors.

true

True or False: When savings accumulate beyond what may be needed for short-term goals and emergencies, then you have money available for investing.

true

True or False: When you purchase a savings bond, you are loaning money to the government.

true

True or False: With a 401(k) plan, employees can avoid paying income tax on money placed in the account until it is withdrawn.

true

True or False: You should complete the register entry for a check before writing the check.

true