Finance

Question 1

Debt ratio

Answer 1

Liabilities/net worth

Question 2

Current ratio

Answer 2

Liquid assets/ liabilities

Question 3

Liquidity ratio

Answer 3

Liquid assets/month exp.

Question 4

Net asset value

Answer 4

(Assets- liabilities)/ number of shares

Question 5

Max rasp conte.

Answer 5

6,000 / year

Question 6

Is rasp taxable?

Answer 6

No

Question 7

Emergency fund is how much?

Answer 7

3 months of monthly expenses

Question 8

What happens when market rates decrease?

Answer 8

Bond values increase

Question 9

Annual shareholder return

Answer 9

[Eoy$+Div]-Boy$]]/boy$

Question 10

Earnigs/share

Answer 10

After-tax earnings/#shares

Question 11

Price - earnings ratio

Answer 11

Market value/earnings per share

Question 12

Actual cash value

Answer 12

Og-[(OG/Lifespan)xage)

Question 13

Income replacement method

Answer 13

Annual income x7x 0.70

Question 14

Main financial benefit of @wning

Answer 14

Investment value growth

Question 15

Who pays the real estates commission

Answer 15

The property seller

Question 16

What is the purpose of the mortgage stress test

Answer 16

To ensure that borrowers could maintain their mortgage if interest rates rise

Question 17

Gds

Answer 17

Monthly mortgage payments / gross monthly income

Question 18

TDS

Answer 18

Monthly mortgage payments + outstanding debt / monthly income

Question 19

Recovering mortgage financing

Answer 19

Closing costs / reduction of mortgage costs

Question 20

Debt payments to income ratio

Answer 20

Debt:gross income-tax -cpp-ei_rrsp

Question 21

What is considered living within your means

Answer 21

.debt-payments ratio under 20%

Question 22

Rule of 72

Answer 22

72/interest is how will long it take for your investments to double

Question 23

What is included in taxable income

Answer 23

Gross + interest + dividend x 1.38 - union - moving expenses

Question 24

Two opportunity costs that might be considered in someone renting who spend lots of time with roommates

Answer 24

May have to delay getting a place, less time to socialize

Question 25

Pros about used cars

Answer 25

Less expensive, less depreciation, more info available about reliability.

Question 26

Pros of new cars

Answer 26

Manufacturswaranty, less likely to need repairs, better financing options, latest technology

Question 27

What is a good credit score above

Answer 27

740

Question 28

Advantages of leasing a vehicle

Answer 28

Lower monthly payments, you may walk away from the vehicle at the end of the lease term, may be a practical solution for those who regularit drive few miles

Question 29

Disadvantages of leasing a vehicle

Answer 29

Additional expenses for damage, no equity, interest rates higher

Question 30

What differentiates a certified pre owned car from others

Answer 30

Often vehicles that have been turned in at end of lease s come with original manufacturers guarantee of quality s they promoted going through inspection

Question 31

What is a great practise when shopping for used whiles

Answer 31

Check carfax report

Question 32

What are the main benefits of investing in muthalfunds

Answer 32

Diversification, professional management

Question 33

Diversification

Answer 33

Involves combining many assets in a portfolio to reduce risk

Question 34

Characteristics of managed funds

Answer 34

Manager chooses all securities and when to buy & sells fees >1%

Question 35

Characteristics of index fund

Answer 35

Manager buys & sells securities so that fund mirrors a desired indexs fees <1%

Question 36

Stocks to bonds ratio

Answer 36

70% in stocks, 30% in bonds

Question 37

Which stock mirrors the Tsx

Answer 37

Index fund

Question 38

Fund that automatically invests in increasingly conservative securities as investors get closer to retirement

Answer 38

Life-cycle/target-datefund

Question 39

Not good assets for retirement

Answer 39

Cars, home equity, checking account

Question 40

Good assets for income in retirement

Answer 40

Rasp, other liquid investments, Tfsa

Question 41

Withdrawal amount considered of ten referred to by financial planners

Answer 41

Safe withdrawal rate

Question 42

What income is gained after retirement

Answer 42

Oas, cpp, tfsa, non-registered investments, rrsp to rrif

Question 43

High risk

Answer 43

Also called speculative risk examples include hedge funds, precious metals and crypto

Question 44

Low risk

Answer 44

Sate investments such as Gl c's treasury Bills index and ETFs