Economics Unit 1: Personal Finance

What happens to your tax liability with proper financial planning?

What are the three primary decision options when it comes to making financial decisions?

Crystal wants the latest limited edition of Vogue magazine, but she needs to buy food for her family. Crystal prioritizes her needs over her wants. What will she most likely do? A. Purchase the groceries, because that is her need. B. Purchase the magazine, because it is a limited edition that she may not see again. C. Purchase the magazine before it becomes outdated. D. Purchase cheaper grocery items so she can still afford the magazine. E. Purchase neither groceries nor the magazine.

What is the first step in financial planning? A. maintaining a log of all your expenses B. understanding what you want C. preparing a balance sheet D. attaching a goal cost to every goal E. attaching a time frame to every goal

Joshua wants to set certain mid-term goals for himself. What kind of time frame would his goals need to qualify as mid-term goals? A. less than one year B. five to eight years C. one to two years D. one to five years E. more than 10 years

An investment bank has a position vacant for the post of finance manager. Which three skills will they look for in their candidates? creativity decision making teamwork abilities quantitative data analysis selling skills

What helps in determining the reliability of a person with regard to repaying debts? A. amount of cash B. number of bank accounts C. credit score D. number of tax deductions E. inflation rate

automatic draft

Cash

Credit Card

Digital Wallet

Portfolio income is generated by:

Passive income is generated by:

the costs of having a basic checking account are:

the costs of having an interest-bearing checking account.

Disadvantages of online banking:

Disadvantages to traditional banking:

Which PCI security requirement relates to the physical protection of banks' customer data? A. network security testing B. access control measures C. credit card data protection D. network vulnerability management E. information security policy

Why is mobile banking considered riskier than online banking? A. Mobile devices are more likely to have malware loaded on them. B. Mobile devices are more likely to transfer financial data incorrectly. C. Mobile devices have more fees associated with their services. D. Mobile devices are less likely to function correctly than home computers. E. Mobile devices are more likely to be lost or stolen.

Match each security practice in electronic banking with the PCI standard that mandates it.

What is the basis for a decision on an unsecured loan? A. collateral B. creditworthiness C. current lines of credit D. home equity E. all of the above

What aspect is factored into a credit score? A. account balances B. investment portfolios C. your choice of profession D. checking account overdraft E. credit inquiries

Match the financial assessment with the appropriate concept.

What creates revolving credit?

What creates closed-end credit?

What are the requirements for filing Chapter 12 bankruptcy?

What are the requirements for filing Chapter 15 bankruptcy?

Alice is a Chinese-American student. She needs student aid to ______ her college education. Due to her origins, she could get a(n) ___________ -based scholarship. She could also apply for other kinds of scholarships for which she is ___________. Although Alice could get a loan, she should really try getting a scholarship because money received as a scholarship is essentially ____________ money.

Which of the following students are not eligible for student financial aid? A. Keith got average grades throughout high school. B. Marshall has an excellent academic record but his family can't afford his education. C. Tony didn't complete high school education. D. Miami resident Gareth does not have a social security number.

Which sentence shows that Sebastien will need to attend entrance counseling and sign a promissory note? Sebastien wants to take a certificate course in Computer Graphics. He has a brother who is in junior high school. Although Sebastien's parents have saved a lot of money to fund their sons' education, Sebastien will need some help to get the education he wants. As advised by his mother, Sebastien filed the FAFSA in January. He was happy to learn that he would be given a loan to cover all college expenses. Sebastien wanted to opt for the work-study program too but his family advised him against it. They were worried that it may not leave him enough time to study. Sebastien had applied for a scholarship along with his friend. While his friend was awarded the scholarship, Sebastien was denied it.

Which of the following could make it difficult for a student to get a housing or vehicle loan in the future? A. not filing the FAFSA every year B. opting for a work-study program C. borrowing more than required D. getting a loan cancelled E. defaulting on a student loan

What is the solution to this situation? Mary is about to complete her course inCell Biology. Her loan agreement requires her to pay back the loan in monthly payments. But Mary thinks it may be difficult to make monthly payments.

What is the solution to this situation? Mary received an award letter from Yale offering her a grant and a student loan.Mary is confused about some of the details in the letter. She isn't sure how much the aid money is repayable.

What is the solution to this situation? Mary wants to pursue the Graduate Program in Cell Biology at Yale.She has the right grades and credits, but she is falling short of money to pay for the course.

What are the disadvantages of leasing a vehicle?

What are the disadvantages of purchasing a new vehicle?

How can a poor housing market put home buyers in a financially unstable position? A. Changing property values means it's easier to find homes with low rental costs. B. When the home value decreases, property taxes and insurance costs increase. C. Houses are valued lower than their purchase prices, so the home equity decreases. D. Home buyers lose all tax benefits and tax incentives when the housing market goes down. E. Mortgage payments can increase even though the home value decreases.

Which item(s) are tax deductible for consumers who are buying or renting a home? A. lease interest payments and fees B. mortgage property appraisal and inspection costs C. closing fees and title costs D. mortgage interest and property taxes E. rental deposits and renter's insurance

Match each right or responsibility in a home rental agreement with the correct party.

Identify the actions related to buying a home and those for renting a home.

Ashton's gross pay is $82,000. He receives tax credits of $2,000. He pays total taxes of $4,500. What are his taxable and disposable incomes? Ashton's taxable income is __________ and his disposable income is _________.

How will you benefit if you make a charitable contribution to a qualified organization?

The Smith family adopted a child. The adoption procedure took about three months, and the family incurred various expenses. Will the Smiths receive any financial benefit for the taxable year? A. they will not receive any financial benefit for adopting the child B. their income tax component will decrease C. they will receive childcare grants D. they will receive a tax credit for the cost borne for adopting the child E. they will receive several tax deductions

Sam is a responsible citizen and files his annual tax returns judiciously. What should he do with tax return documents that are more than three years old? A. he should submit the documents to the local authorities B. he should keep the tax returns in a safety deposit box and shred the supporting documents C. he should keep the documents with his attorney D. he should submit the documents to his employer E. he should submit the documents to the IRS for audit

On what component is excise tax levied?

Identify the features of stocks and bonds.

Which characteristic describes the privatization of Social Security? A. increases the employer's contribution to Social Security B. raises the retirement age to claim full benefits to 70 C. enables Americans to invest their Social Security contributions in the stock market D. reduces benefits across the board by 13 percent E. obtains a loan from the Fed

When will the Social Security fund dry up at its current level? A. 2022 B. 2027 C. 2042 D. 2097 E. 2117

Match each type of savings account with its features.

Distinguish between responsibilities of the FTC and those of the SEC.

Match each cost with the investment type to which it relates.

Identify the investment options as low risk or high risk.

Which three factors make starting a business a highly risky investment? high coupon rate uncertain business conditions large amount of capital low interest rates low liquidity

What benefit does a 401(k) plan provide over an IRA? A. a higher rate of return B. fewer investment options C. less investment risk D. on-hand financial advisors E. employer's contribution

Match each fee that mutual funds charge investors with its correct description.

What benefit does the PPO provide? Select all that apply. covers out of network doctors and specialists freedom to see more doctors requires referrals provides primary care physician only covers in network providers

Conrad is an architect who has just been sued because a building he helped design has collapsed and injured several people. What type of insurance would help him with court costs and settlements. A. legal malpractice B. universal C. medical malpractice D. general liability E. catastrophic

Match the types of agreements to their descriptions.

Components of a trust

Components of a irrevocable trust

Components of an exclusive provider organization.

Components of a point of service