Unit 1 Test Flashcards
Samantha wants to learn more about financial issues that can affect her life. She is learning about
Personal Finance
The process will help George plan his financial future.
Personal Finacial Planning
Leon used money from his savings account for a down payment on an ATV. Money in his savings account is an example of
liquid asset
is a legal process filed when one is unable to pay their bills
bankruptcy
Allison wanted to spend the evening at the movies with friends instead of working at the grocery store. With this decision she incurred an
opportunity cost
The process of planning every aspect of your personal finances is known as
personal finacial planning
Liquid assets are those possessions that can be rapidly converted to
cash
All of the following are important in choosing a career except
gender
Which of these would not be considered an expense item in a budget
tax return
Good financial planning can help you achieve all of the following goals except
winning the lottery
Tara wants to have financial success, so she develops a
personal finacial plan
Clayton planned his spending and savings for the next three months by his money
budgeting
Rafael added up his assets and subtracted his liabilities to determine his
net worth
Lorenzo listed his motorcycle as an on his bank loan
asset
Lorenzo also listed the remaining $1,500 he owes on his motorcycle as a
liability
Susan has a car worth $6,000. She has paid off half of it so she has $3,000 in her car.
equity
Sarah makes $1,200 per month at her job and receives $50 a month from her parents in allowance. The $1,250 she brings in each month is listed as in her budget
income
Tamara needed $150 by next week to pay for a new warm up for basketball. She looked at her to determine her ability to pay for the warm up.
liquidity
good would help Tamara be prepared for extra expenses like a new warm up.
money management
Javier received a credit card application in the mail. His parents talked with him about good before he applied for the card
credit management
Javier noticed that the credit card company charges 18% each month he is late to pay off his card.
interest
Javier’s parents went over the of the credit card with him so that he would fully understand when he would need to pay the card off so that he didn’t have to pay interest.
payment terms
Jeff bought the least insurance coverage on his car. He is taking a because if he gets in a wreck, he may have to pay a lot out of pocket.
risk
Rachel had little savings, so she knew she would have to the purchase of her car.
finance
is not a very liquid investment because it is not easy or always possible to sell buildings and land quickly.
real estate
Assume you have a car worth $3,200 and investments worth another $7,500. If your only debt is $1,300 on a credit card payment, what is your current net worth?
$ 9,400
How much does Jill have in liquid assets if her car is worth $4,500 and she has $1,110 in a savings account and $532 in a checking account?
$ 1,642
If you buy a house for $250,000 and put $20,000 in initially on a down payment, how much equity do you have in the house?
$ 20,000
Mike makes $75 a week mowing lawns, he decides in July that he wants to take 2 weeks off and go on a vacation that will cost him a total of $300. What is his opportunity cost? And what is his total cost of this decision?
Opportunity: $150 total:$450
You have decided to save 30% of your income for the next two years. You bring home $200 a week, how much will you save over that time?
$6,240
Which of the following is not a component of a financial plan?
utilities
Net worth is the difference between
assets and liabilities
Which of the following is not a source of income?
car payment
A person’s income may depend on all of the following except:
height
Consumers tend to spend the highest percentage of their budget on:
housing
Assume you intend to borrow $5,000. Which of the following payment terms would be the best deal?
5 percent for 4 years
Which of the following is a key component of risk management?
insurance
In general, the higher risk of a particular investment the higher the potential
return
The most common investments include
stocks and bonds
Good record keeping is important for
estate planning
