Personal finance chapter 1

Question 1

interest rate

Answer 1

the percentage of principal charged by the lender for the use of its money

Question 2

personal finance

Answer 2

all the financial decisions a person or family makes to earn, budget, save, spend, and give money over time

Question 3

consumer

Answer 3

a person or organization that uses a product or service

Question 4

debt

Answer 4

money owed to another person or company

Question 5

paycheck to paycheck

Answer 5

a person or household whose monthly income is devoted to expenses and has little to no savings

Question 6

the average borrower has how much money of debt?

Answer 6

over 34,000

Question 7

personal finance does involve some math, but it is mostly about….

Answer 7

behavior

Question 8

personal finance is 20% head knowledge and…

Answer 8

80% behavior

Question 9

credit

Answer 9

the granting of a loan and creation of debt

Question 10

loan shark

Answer 10

person or entity that charges borrowers interest rates above an established legal rate

Question 11

interest

Answer 11

the additional cost a lender charges for borrowing their money

Question 12

financial plan

Answer 12

allows a person to meet not only their immediate needs but also their longterm goals

Question 13

net worth

Answer 13

the amount by which the value of the persons assets exceeds or falls behind the value of their liabilities

Question 14

asset

Answer 14

anything owned by an individual

Question 15

liability

Answer 15

financial debts or obligations

Question 16

positive net worth

Answer 16

the dollar value of a persons assets is greater than the dollar value of their liabilities

Question 17

negative net worth

Answer 17

the dollar value of a persons liabilities is larger than the dollar value of their assets

Question 18

net income

Answer 18

what a person earns after tax and deductions are taken out

Question 19

expense

Answer 19

the cost of goods or services used to operate a business

Question 20

first foundation

Answer 20

save a $500 emergency fund

Question 21

second foundation

Answer 21

get out and stay out of debt

Question 22

third foundation

Answer 22

pay cash for your car

Question 23

fourth foundation

Answer 23

pay cash for college

Question 24

fifth foundation

Answer 24

build wealth and give

Question 25

financial liability

Answer 25

knowledge and skill necessary for people to be informed consumers and manage their finances effectively

Question 26

we all have…

Answer 26

money personalities

Question 27

what is the starting point for a financial plan?

Answer 27

knowing your net worth

Question 28

always remember that you will manage your money or the lack of it will…

Answer 28

lead to money problems managing you

Question 29

almost half of all americans report having less than ? in their savings

Answer 29

1,000

Question 30

what is the total student loan debt owed in the U.S?

Answer 30

1.5 trillion

Question 31

what is the percentage of americans living paycheck to paycheck?

Answer 31

80%