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What are stocks? |
Shares of ownership in a company that may pay dividends |
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The rate of return being offered by banks on money market accounts is 3% and increasing. Which of the following might cause this to happen? |
The Federal Reserve raised the federal funds rate |
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Calliope is in her mid-30s and wants to start saving for retirement. She wants to invest a portion of her income, but she’s wary of high-risk options. How should she best allocate her investment funds? |
Bonds and mutual funds |
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Why might buyers be more inclined to purchase a product if it is listed for sale at $49.99, rather than $50? |
The one-cent reduction makes the price seem more attractive. |
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"Tax bracket" is a term associated with which type of taxation? |
Progressive |
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Johann maintains a $75,000 insurance policy on his boat. He pays $50 per month in premiums and his deductible is $2,500. If he is involved in an accident that does $2,000 worth of damage to the boat, how much will he have to pay? |
$2,000 |
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Which of these is an example of indirect tax? |
Gasoline tax |
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Assume that the blue section (D) of the chart stands for stocks and the red (A) for mutual funds. This would most likely represent the portfolio of a |
young investor |
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Your friend’s job pays $10 per hour, and he works 40 hours per week. His tax rate is 20 percent. Assuming he works 50 weeks of the year, his yearly net income is |
$16,000 |
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Which tax uses the same rate for all income levels? |
Proportional |
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Austin earns $18,000 per year. His earnings put him in the 15% tax rate. What is his tax owed? |
$2,700 |
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What is likely to happen if a borrower misses a payment on a credit card account? |
The credit card company applies a penalty rate, increasing the card’s interest rate. |
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Making a down payment reduces the |
loan principle amount |
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Your friend’s job pays $5.00 per hour, and he works 20 hours per week. His tax rate is 20 percent. Assuming he works 50 weeks of the year, his yearly gross income is |
$5,000 |
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Rudy is a 52-year-old freelance writer who wants a short-term, low-risk investment with low liquidity. Which of these investment vehicles should he consider? |
– CD – Mutual fund – Stocks |
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Which of the following actions would likely raise homeowner’s insurance premiums? |
Building the home in the floodplain of a river |
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If an investor possesses a portfolio heavily concentrated in bank checking accounts, a financial advisor would most likely suggest which of the following aggressive investments to diversify the portfolio? |
Stocks |
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Pieta has found that his annual budget does not balance. Which of the following could he most easily adjust first? |
Variable expenses |
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Rachel finds a new apartment that she loves in the center of downtown, but she ultimately decides against renting it because the $1,500 per month price tag greatly exceeds her budget. Rachel’s decision to forgo the new apartment is mainly based on |
her limited income |
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Jeanine paid an annual premium of $1,200 in total liability coverage for her car, including up to $400,000 in bodily injury coverage and $100,000 in property damage coverage. Twelve years into her policy, Jeanine caused an accident that resulted in the other driver claiming $40,000 in medical costs and $15,000 in car damage. Jeanine’s insurance company paid the claim. |
Yes, the cost of the annual premium for 12 years was less than the accident claims |
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Which type of credit involves a set limit based on what a consumer pays up front? |
Secured credit cards |
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What will happen if Jonathan is habitually late on loan payments? |
His credit score will suffer |
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Kendra wants to become a computer technician, but she has a great deal of debt. She makes a yearly budget and finds that her projected income and expenses do not balance. What should she do to immediately correct this imbalance? |
Reevaluate her fixed and variable expenses |
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Laurent saves money from his lawn service to buy a new $20,000 mower and trailer. He would like to buy the new equipment as soon as possible but only has $12,000 in his simple interest savings account. To reach his goal sooner, Laurent should |
Move his money to a compound interest account |
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Your friend’s job pays $5.00 per hour, and he works 20 hours per week. His tax rate is 20 percent. Assuming he works 50 weeks of the year, his yearly gross income is |
$5,000 |
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