ugh finance
The major function of personal financial planning is to A. Achieve personal economic satisfaction. B. Reduce taxes. C. Increase savings. D. Obtain adequate insurance protection. E. Improve your credit rating.
A. Achieve personal economic satisfaction.
If a $10,000 investment earns a 4 % annual return, what should its value be after one year? A. $100 B. $10,000 C. $400 D. $10,400 E. $4,000
D. $10,400
If Melinda Miller estimates that her $100 weekly grocery bill will increase at an annual inflation rate of 4%, what should her weekly grocery bill be in 3 years? A. $112.00 B. $114.00 C. $121.60 D. $112.49 E. $100.00
D. $112.49
The problem of bankruptcy is associated with overuse and misuse of credit in the ______________ component of financial planning. A. Sharing B. Savings C. Obtaining D. Borrowing E. Protecting
D. Borrowing
The Rule of 72 is: A. The number of steps required to complete a financial plan B. Used to calculate interest rates for savings C. The legal code for requiring companies to provide a match on retirement savings D. Used to estimate how fast prices will double using a given annual inflation rate E. A tool to determine the number of years until retirement for an employee
D. Used to estimate how fast prices will double using a given annual inflation rate
If a $10,000 investment earns a 7% annual return, what should its value be after 6 years? A. $10,700 B. $10,000 C. $15,100 D. $15,000 E. $15,007
E. $15,007
Patrick Guitman recently graduated from college with $20,000 in student loans and $5,000 in credit card debt. He usually makes minimum payments on his debt and he has been late with three payments in the last year. He wants to buy a new car but was told that his interest rate on a loan would be very high. What is the most likely reason this might be so? A. He already has a student loan outstanding B. Recent graduates are not allowed to have more than $25,000 in debt outstanding C. General interest rates are very low D. Interest rates must be tied to the CPI E. His credit rating is poor which results in a higher interest rate
E. His credit rating is poor which results in a higher interest rate
Opportunity cost refers to A. Money needed for major consumer purchases. B. Current interest rates. C. Evaluating different alternatives for financial decisions. D. The amount paid for taxes when a purchase is made. E. The trade-off of a decision.
E. The trade-off of a decision.
