Chapter 1 Flashcards
which of the following best explains why students should learn about personal finance?
learning to manage money at this stage can eliminate financial mistakes
key components of financial planning include all of the following except?
allow your financial planner to make all of your major money decisions
which of the following statements best describes how americans are being outsmarted by banks and other lenders
credit is marketed to make us ignore interest rates and fees that destroy
personal financial success is primarily the result of
managing your money behavior
which of the following statements best explains why income alone does not determine wealth
how much money you make does not dictate your spending and saving behavior
which of the following is a consequence of spending more than you make
1.missed opportunity to save and invest 2.stress 3. a cycle of dept
which of the following is not a true statement
the credit industry in america has not changed much since 1917
when it comes to managing success is about _% knowlege and _% behavior
20, 80
the wide spread financial insecurity of americans is primarily because
the saving rate of americans is low and many soend more than they make
which of the follwing is not a factor in becoming money smart
learn how to read your credit card statements
which of the following is not a benefit of understanding your own money personality
knowing yoyr money personality allows you to excuse exessive spending
why was the use of credit uncommom prior to 1917
1.borrowing money was generally not socially acceptable 2. laws prevented lenders from charging high interest rates 3. lending money to others was not profitable
when it comes to peronal finance, the math is easy. whats challenging is managing your
behavior
which of the following is not a reason credit is marketed heavily to consumers in the united states
the use of credit is not socially accepted in the united states
new deal policymakers came up with mortgage amd consumer lending polocies that convinced banks that
consumer credit could be profitable
true financial security is achieved when your money begins to generate an income -your money starts working for you
true
since your a teenager what you do now with money will have little effect on yoyr financial future
false
most americans today are wealthy and will have financial security when they retire
false
most americans avoid the use of credit when it comes to buying big ticket items like a car or funiture for thier home
false
learning the language of money is not that important because you will be able to depend on financial planners
false
having debt keeps you from building wealth
true
the credit system is structured to utilize high interest rates and fees to turn huge profits
true
expensive houses and new cars are a true indication of wealth
false
when developing a personal financial plan, 1 of the first things to do is assess your current fianancial situation
true
everyone should have the same financial plan. a budget that works for one person should be sufficient for everyone
false
a person or business that offers loans at extremely high interest rates
loan shark
a person or organization that uses a product or service
consumer
an obligation of repayment owed by one party to a second party
debt
the granting of a loan and the creation of debt; any form of deferred payment
credit
the knowledge and skillset necessary to be an informed consumer and manage finances effectively
financial literary
a fee paid by a borrower to the lender for the use of borrowed money
interest
a system by which goods and services are produced and distributed
economy
a debt evidence by a note, which specifies the principal amount interest rate, and date of repayment
loan`
a period of temporary economic decline during which trade and industrial activity are reduced
recession; loan
all of the decisions and activities of an individual or family regarding thier money, including spending, saving, etc
loan; personal finance
