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FINANCE EXAM 1 MULTIPLE CHOICE

Terms in this set (26)

A formalized report that summarizes your current financial situations analyzes your financial needs and recommends;
FINANCIAL PLAN
An advantage of effective financial planning is;
AN INCREASED CONTROL OF FINANCIAL AFFAIRS
An investor should expect to receive a risk premium or;
HIGHER UNCERTAINTY OF GETTING HIS/ MONEY BACK
The rule of 72 is;
USED TO ESTIMATE HOW FAST PRICES WILL DOUBLE USING A GIVEN ANNUAL INFLATION RATE
Which of the following would increase the interest rate for a loan;
POOR CREDIT RATING
The goal of investing $50/ month for the next 12 years for your nephews college funds is;
LONG TERM GOAL
If i can invest $1 today and earn interest on it then it should be worth;
MORE in the future
If you begin saving $2k/ year at 5% and from age 22-30... what will these funds grow to in those years;
11.027
Money management refers to what;
DAY TO DAY FINANCIAL ACTIVITIES
The amount you would have left if all assets were sold and al debts were paid in full is called;
NET WORTH
How long should you keep documents related to investments;
AS LONG AS YOU OWN THESE ITEMS
The main purpose of a personal financial statement is to;
ALL OF THE ABOVE
The inability to pay debts when they are due because liability far exceed the value of assets is called;
INSOLVENCY
Disposable income equals;
THE AMOUNT A PERSON/ HOUSEHOLD HAS TO SPEND
Discretionary income is;
MONEY LEFT OVER AFTER PAYING FOR HOUSING, FOOD, AND OTHER NECESSITIES
When creating a budget, which of the following statements is true;
NUMBERS IN THE BUDGET ARE ESTIMATES
A worker's primary goal should be to;
PAY HIS/ HER FAIR SHARE OF TAXES WHILE TAKING ADVANTAGE OF APPROPRIATE TAX BENEFITS
The document that would be most useful to plan spending and saving to achieve financial goals is; BUDGET
BUDGET
TAXES ON EARNINGS THAT FUND OLD AGE SURVIVOR AND DISABILITY INSURANCE BENEFITS;
SOCIAL SECURITY TAXES
This tax is a major financial planning factor for most people because it is sometimes imposed at the federal, state, and local level;
INCOME TAX
These tips and bonuses are a part of;
EARNED INCOME
You may be required to make estimated tax payments if;
YOU'RE AN INDEPENDENT CONTRACTOR
Adjustments to income include all of the following except;
CHARITY CONTRIBUTIONS
At the end of the year giveon received a X from her bank that;
1099
Th types of tax services available that offer profession tax proficiencies include;
ALL OF THE ABOVE
Income that is not subject to tax is called;
TAX EXEMPT INCOME
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