NHHS Personal Finance Midterm Review Flashcards
Ian has been shopping for a different vehicle for the past several months. He needs something reliable and would really like something with a nice sound system. He and his parents have talked about how much he can afford and he plans to stay within the price guidelines he and his family have set. Ian was analyzing the opportunity cost of a trade-off regarding which car to purchase. Which situation best represents what he might be thinking through?
A
Ian is comparing new vehicles at two car dealerships. He was able to find nearly identical cars at nearly identical prices. One dealership is 20 miles away and the other dealership is 30 miles away.
B
Ian has found two different cars at a local dealership that meet his needs. The first car has a better sound system than the other. The second car has 20,000 fewer miles on it.
C
Ian has been shopping for a vehicle online. He finds something that would meet his needs being sold by an individual near him. He would be able to purchase this car for less than he would have paid for a comparable vehicle at a car dealership.
D
Ian’s older brother is trading vehicles and offers to sell Ian his used vehicle. This vehicle would meet Ian’s needs and he knew the ervice history of the vehicle was excellent.
B, Ian has found two different cars at a local dealership that meet his needs. The first car has a better sound system than the other. The second car has 20,000 fewer miles on it.
Which of the following is likely to have the least influence on an individual’s values?
A
Media
B
Family
C
Religious affiliations
D
Grade average
D, grade average
Megan’s mother suggested that she was experiencing the consequences of her trade-off regarding a decision she made to purchase a dress for prom. Which situation does Megan most likely find herself in for her mother to have made this comment?
A
Megan had shopped at several stores when she found the prom dress of her dreams and purchased it. She used the money she had saved for the prom dress plus most of the money she had saved for replacing the tires on her car. Now the tires need replacing and Megan is short on the cash needed to do the job.
B
Megan had shopped at several stores when she found the prom dress of her dreams. She checked online and found a coupon that enabled her to save 30% when she returned to the store to purchase the dress.
C
Megan had shopped in several stores and found six prom dresses she liked a lot. She brought 2 friends shopping with her to tell her which one looked best on her. After much deliberation, she chose the dress that was the least expensive of the 3 she liked best.
D
Megan had shopped in the store her mother recommended for her prom dress. She found two dresses she liked a lot. Megan purchased the one that was the most comfortable even though it cost $28 more than the ther one.
A, Megan had shopped at several stores when she found the prom dress of her dreams and purchased it. She used the money she had saved for the prom dress plus most of the money she had saved for replacing the tires on her car. Now the tires need replacing and Megan is short on the cash needed to do the job.
Kaylee will save her allowance of $25 per month to purchase a $150 MP3 player in six months. This is an example of what type of goal?
A
Short‐term goal
B
Long‐term goal
C
Mid‐term goal
D
This is not an example of a goal.
A, short Term goal
Amber’s academic adviser has asked her to set 3 academic goals for this semester. These goals are most likely to be accomplished if:
A
Amber discusses her goals with her parents.
B
Amber lets her friends set her goals.
C
Amber writes her goals down.
D
Amber thinks about her goals weekly.
C, Amber writes her goals down
Jacob is wondering how he can improve his intellectual well-being. Which would contribute the most to his intellectual well-being?
A
Going to the gym three times per week
B
Challenging himself by taking on a new project at work
C
Joining a local service organization
D
Taking a vacaton from work
B,
Carter wants to participate in an activity that will improve his well-being. Which activity would contribute the most to his well-being?
A
An activity his friends like to participate in
B
An activity that does not cost much money
C
An activity that his teacher suggested to him
D
An activity that makes him lose track of time
D
Jenna wants to improve her financial well-being. Which would contribute the most to her financial well-being?
A Taking a personal finance class to learn how to manage her money
B
Paying her grandma back the money she borrowed to take a school trip last year
C
Talking to her friends about how to manage her money better
D
Opening another checking account to help her organize her mone
A
Whitney is shopping with her mom and they are deciding on clothing to purchase. Which scenario best represents the purchase of a need?
A
Whitney is being inducted into the National Honor Society at her high school. Students have been directed to ‘dress nicely’. Whitney has a dress she wore to a wedding last year that still fits but her mom thinks she needs a new one to celebrate this occasion.
B
Whitney has been selected to attend a national leadership conference and has been instructed that she will need to dress ‘professionally’ for one of the tours. She plans to wear her new jeans and a T-shirt that has the logo of the leadership conference on it. Her mother thinks she needs to purchase something more appropriate.
C
Whitney has several pairs of jeans in her closet but found some that really fit her well at an excellent price when she and her mom were shopping. Her mom agrees that with these jeans at this price, they need to purchase a pair.
D
Whitney will be traveling to Europe with a youth ambassador program this summer. She has been instructed to pack a rain jacket. The rain jacket she already owns does not have a hood since she always uses an umbrella in rainy situations. Her mom believes she needs to purchase a hooded rain jacket because it would be more convnient.
B
Which statement about our interactions with money is not considered to be true?
A
You are responsible for your present self and your future self.
B
Your present self impacts your future self.
C
You are better off in a community than by yourself.
D
Investment increases risk and reduces your ability to cope with risk and uncertainty.
D
Who is Medicare designed to help?
A
Low-income families
B
Single parents
C
Senior citizens
D
Children of unemployed parents
c
Which formula should Jordyn use to calculate her net worth?
A
Assets – liabilities = net worth
B
Assets × liabilities = net worth
C
Assets + liabilities = net worth
D
Assets / liabilities = net worth
a
A key difference between commercial banks and credit unions is that:
A
commercial banks are for-profit and credit unions are not-for-profit.
B
commercial banks typically pay higher interest rates than credit unions.
C
credit unions are more commonly located in rural areas while commercial banks are more commonly located in urban areas.
D
commercial banks offer more services, debit cards, and online banking than credit unions.
A
Common fees that may be charged by a depository institution include all of these except which one?
A
Overdraft fees
B
Late fees
C
ATM fees
D
Minimum Balance fees
B
Jonah is writing down his liabilities to complete his Statement of Financial Position. The item he should include would be:
A
the market value of his car.
B
the value of his retirement account.
C
the combined total of his savings and checking accounts.
D
the balance on his credi card.
D
Maggie earns $62,000 per year and has a net worth of $20,000. Samantha earns $96,000 and has a net worth of $15,000. Who is wealthier?
A
Maggie, because her income minus her net worth is a smaller amount than Samantha’s.
B
Samantha, because her income minus her net worth is a larger amount than Maggie’s.
C
Maggie, because her net worth is higher than Samantha’s.
D
Samantha, because her annual income is higher than Maggie’s
C
Since Taylor was a young child she has kept her savings in a piggy bank. She likes this method of saving because she can have immediate access to the money if she needs it. Recently, in a class at school, discussion focused on why depository institutions are safer than her piggy bank. Some student comments were based on fact while others were based on myths. Which aspect of security at a depository institution is not true?
A
Depository institutions have insurance protection for up to $250,000 per depositor per account type so if something happened to the money in the bank, you would get it back as long as the deposited amount was no more than the insurance limit.
B
All money stored at a depository institution is kept safe at all times by numerous security measures.
C
Information about depositors and their accounts is kept in secure data storage.
D
Depository institutions have insurance protection. Depositors can have multiple accounts insured at the same depository institution as long as each account has no more than a $100,000 balance
D
Samantha wants to be able to use funds in her checking account but finds going to the bank to withdraw cash to be inconvenient. She would like a more effective way to access her checking account funds. What would you suggest she do?
A
Apply for mobile banking. That way she can access her money with her smartphone to pay for the things she needs. The amount she spends would automatically be deducted from her savings account.
B
Apply for a debit card. That way she can use the card instead of cash to purchase the things she needs and the amount spent is immediately deducted from her account.
C
Apply for a credit card. That way she can use the card to purchase the things she needs and pay for it when the credit card statement comes from her checking account.
D
Request a cashier’s check from her depository institution. That way she can spend money from her checking account withot risk of an overdraft fee.
B
Which would most likely be considered a contractual expense?
A
Cell phone
B
Food
C
Entertainment
D
Clothing
a
To increase his net worth, Jackson could:
A
increase his liabilities.
B
decrease his assets.
C
increase his market value.
D
increase his assets.
d
Diana and Aaron have decided to develop a spending plan to help them gain control over their finances. Which statement is not true about spending plans?
A
Spending plans are used to record planned income.
B
Spending plans are used to record planned expenses.
C
A spending plan includes items not usually included when creating a budget.
D
When creating a spending plan, it is recommended that one examines trade-offs and opportunity costs.
c
Austin has just received his first paycheck. He worked 22 hours at his new job and is being paid $8.00 per hour. He calculated that his paycheck should be $176. His paycheck amount is almost 1/3 less than he expected. What is the most likely reason that Austin’s pay is less than he expected it to be?
A
Austin calculated the hours he worked without deducting the hours he spent doing on-the-job training.
B
Austin neglected to deduct the excise tax paid on the uniforms he purchased to wear at his job.
C
Austin neglected to deduct the amount required to pay income and payroll taxes.
D
Austin’s employer made a mistake calculating the number of hours Austin worked during his first pay period.
c
