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Personal Finance > Semester 2 Exam > Flashcards

Semester 2 Exam Flashcards

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1
Q

T/F

US savings bonds are considered a tax-exempt or tax-free investment choice

A

True

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2
Q

T/F

Today, more employers are offering employer-sponsored retirement plans than they were in the past

A

False

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3
Q

T/F

Earnings from tax-deferred investments are completely free from tax

A

False

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4
Q

T/F

Stocks are shares of ownership in a corporation

A

True

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5
Q

T/F

Money in a savings account is considered to be a safe and liquid investment

A

True

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6
Q

Unexpected emergencies or other unplanned events are known as…

A

Contingencies

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7
Q

Which of the following goals would be considered a long term goal?

A

Owning a house

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8
Q

Which of the following types of investment risk could occur as a result of a company’s poor management or product recalls?

A

Stock risk

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9
Q

Which of the following types of investment risk could occur if prices, in general, rise faster than the return on investment?

A

Inflation risk

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10
Q

A long term, planned approach to making investments is called…

A

Systematic investing

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11
Q

T/F

A money-market deposit account at a bank is a high-risk investment because it is not insured

A

False

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12
Q

T/F

A typical CD is not a liquid investment because you must pay a penalty if you withdraw the money before the stated time

A

True

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13
Q

T/F

Series EE U.S. Savings Bonds are subject to federal income tax, unless they are used to finance education

A

True

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14
Q

T/F

A premium bond is one that sells for less than its face value

A

False

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15
Q

T/F

Investment grade corporate bonds have high ratings and are considered fairly low risk

A

True

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16
Q

Which of the following investments is a medium risk choice?

A

Mutual funds

17
Q

Which of the following types of investments is a form of an indirect investment?

A

Mutual funds

18
Q

Which of the following types of bonds can be exchanged for shares of common stock?

A

Convertible bond

19
Q

Which of the following investment options is illiquid?

A

Real estate

20
Q

A corporate bond is redeemed for its…

A

Face value

21
Q

T/F

Business Week and Fortune are examples of magazines that contain information related to investing

A

True

22
Q

T/F

Major newspapers typically do not include a section about business and investing

A

False

23
Q

T/F

Re-investing allows stockholders to buy new shares of stock at a reduced price from a stockbroker

A

False

24
Q

The NYSE is an auction market where stock is sold to the highest bidder

A

True

25
Q

Using the OTC market to buy stocks is an example of direct investing

A

False

26
Q

Which of the following transactions is a request to buy or sell stock at the current price?

A

Market order

27
Q

Which of the following figures compares the selling price of stock to the annual profits per share?

A

Price earnings ratio

28
Q

Which of the following organizations is a private, nonprofit organization that regulates firms selling securities in the US?

A

Financial Industry Regulatory Authority

29
Q

Which of the following government agencies is responsible for the economic security of the US?

A

US Department of the Treasury

30
Q

The MyMoney.gov and My Money Tool Kit for Consumers are provided by the…

A

US Financial Literacy and Education Commission

31
Q

T/F

You need to read newspapers and magazines to keep up with what is going on in the world

A

True

32
Q

T/F

Unless the employer requests that it be typed, a letter of application should be handwritten

A

False

33
Q

T/F

Employers do not have the right to monitor an employee’s email

A

False

34
Q

Which of the following is a true statement about new employees?

A

They should follow the rules exactly

35
Q

T/F

The more allowances you are able to claim on your W-4, the more federal tax will be withheld from your paycheck

A

False

36
Q

T/F

If you lose your social security card, you may apply and receive a new number

A

False

37
Q

The Fair Labor Standards Act established…

A

Minimum wages

Personal Finance (1 decks)

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