Question 1

A valuable asset pledged to assure loan payments and which can be seized upon default is called:

Accepted Answer

A)   capacity.
B)   character.
C)   capital.
D)   collateral.
E)   conditions.

Question 2

In the following table,fill in the missing values for a $15,000 one-year bond:

Accepted Answer

The answer of In the following table,fill in the missing...

Question 3

________ is/are an example of an ownership investment.

Accepted Answer

A)   T-bills
B)   Mortgage-backed bonds
C)   Stock
D)   Corporate bonds
E)   Mutual funds

Question 4

The uncertainty associated with decision-making is referred to as:

Accepted Answer

A)   opportunity cost.
B)   selection of alternatives.
C)   financial goals.
D)   personal values.
E)   risk.

Question 5

Which of the following would NOT cause a person to prefer renting over buying housing?

Accepted Answer

A)   a large amount of funds needed for front-end expenses
B)   unknown job stability in the geographical area
C)   the responsibilities of home maintenance
D)   the future aspect of selling the home
E)   low mortgage interest rates

Question 6

Which one of the following is true?

Accepted Answer

A)   When choosing an investment, risk factors are rarely necessary.
B)   A risk exists that the financial return on an investment will not keep pace with the rate of inflation.
C)   A risk exists that market interest rates of bonds are the result of changes in business conditions faced by companies.
D)   A risk exists that business failures result from moderate changes in market interest rates.
E)   The prices of stocks, bonds, and other investments never fluctuate in the market.

Question 7

Renting is more advantageous than buying a home when you are seeking:

Accepted Answer

A)   lower short-term living costs.
B)   a place to remodel.
C)   a long-term investment.
D)   tax benefits.
E)   a permanent residence.

Question 8

An investor wanting a low-risk source of income provided by an investment would choose:

Accepted Answer

A)   government bonds.
B)   commodities, such as oil.
C)   precious metals.
D)   stocks.
E)   speculative investments.

Question 9

The tax deductible expense related to home ownership is/are:

Accepted Answer

A)   public utilities.
B)   homeowner's insurance.
C)   home improvements.
D)   mortgage interest.
E)   mortgage principal.

Question 10

If the dollar price of a bond is $7,500 and the par value of the bond is $8,000,the interest rate is equal to:

Accepted Answer

A)   7%.
B)   6.67%.
C)   6.25%.
D)   14%.
E)   5%.

Question 11

________ risk refers to the danger of lost buying power during times of rising prices.

Accepted Answer

A)   Trade-off
B)   Economic
C)   Personal
D)   Inflation
E)   Interest rate

Question 12

Which bond rating does Standard & Poor's assign to a bond that is in default?

Accepted Answer

A)   A
B)   B
C)   C
D)   D
E)   Z

Question 13

Your friend Earl is starting a dog-grooming service called "Petsgroom." Because his business is new and risky,he is unable to obtain a loan from the local bank.You agree to pay a price of $7,250 for a one-year bond from Earl.
a.Calculate the par value of the bond with an interest rate of 3.4%.
b.Calculate the par value of the bond with an interest rate of 6.7%.
c.Comment on the relationship between the purchase price of the bond and the interest rate.

Accepted Answer

a.$7,496.50
b.$7,735.75
c.The interest r...

Question 14

Opportunity cost refers to:

Accepted Answer

A)   money needed for major consumer purchases.
B)   what a person gives up by making a choice.
C)   the amount paid for taxes when a purchase is made.
D)   current interest rates.
E)   evaluating different alternatives for financial decisions.

Question 15

Valerie Rose owns stock.She was just advised that she will be receiving two shares for every one share she owns today.What has the company declared that will cause this change to her shares?

Accepted Answer

A)   extra dividend
B)   capital gains distribution
C)   stock split
D)   stock repurchase
E)   stock conversion

Question 16

What are four types of U.S.government securities? What are their maturity times,if any?

Accepted Answer

Savings bonds,which vary in maturity for...

Question 17

The collection of securities and other investments owned by a mutual fund is called a(n) :

Accepted Answer

A)   investment company.
B)   portfolio.
C)   mutual fund family.
D)   prospectus.
E)   package.

Question 18

Savings compounded ________ would have the highest return on investment.

Accepted Answer

A)   daily
B)   annually
C)   semi-annually
D)   monthly
E)   weekly

Question 19

Refinancing a mortgage is recommended when:

Accepted Answer

A)   interest rates rise.
B)   interest rates fall.
C)   the escrow account balance declines.
D)   two or more points are required by the lender at the time of closing.
E)   the escrow account balance increases.

Question 20

The date on which the repayment for a loan is due is called the ________ date.

Accepted Answer

A)   maturity
B)   deferment
C)   deadline
D)   face value
E)   par

Exam 19: Personal Finance

Which of the following would NOT cause a person to prefer renting over buying housing?

Correct Answer
verified

Valerie Rose owns stock.She was just advised that she will be receiving two shares for every one share she owns today.What has the company declared that will cause this change to her shares?

Correct Answer
verified

Which one of the following is true?

Correct Answer
verified

The tax deductible expense related to home ownership is/are:

Correct Answer
verified

Refinancing a mortgage is recommended when:

Correct Answer
verified

The date on which the repayment for a loan is due is called the ________ date.

Correct Answer
verified

A valuable asset pledged to assure loan payments and which can be seized upon default is called:

Correct Answer
verified

The uncertainty associated with decision-making is referred to as:

Correct Answer
verified

What are four types of U.S.government securities? What are their maturity times,if any?

Correct Answer
verified
Savings bonds,which vary in maturity for...
View Answer

Savings compounded ________ would have the highest return on investment.

Correct Answer
verified

Opportunity cost refers to:

Correct Answer
verified

________ risk refers to the danger of lost buying power during times of rising prices.

Correct Answer
verified

An investor wanting a low-risk source of income provided by an investment would choose:

Correct Answer
verified

If the dollar price of a bond is $7,500 and the par value of the bond is $8,000,the interest rate is equal to:

Correct Answer
verified

In the following table,fill in the missing values for a $15,000 one-year bond:

Correct Answer
verified

Which bond rating does Standard & Poor's assign to a bond that is in default?

Correct Answer
verified

Correct Answer
verified
a.$7,496.50
b.$7,735.75
c.The interest r...
View Answer

Renting is more advantageous than buying a home when you are seeking:

Correct Answer
verified

The collection of securities and other investments owned by a mutual fund is called a(n) :

Correct Answer
verified

________ is/are an example of an ownership investment.

Correct Answer
verified

Exam 19: Personal Finance

Which of the following would NOT cause a person to prefer renting over buying housing?

Correct AnswerverifiedShow Answer

Valerie Rose owns stock.She was just advised that she will be receiving two shares for every one share she owns today.What has the company declared that will cause this change to her shares?

Correct AnswerverifiedShow Answer

Which one of the following is true?

Correct AnswerverifiedShow Answer

The tax deductible expense related to home ownership is/are:

Correct AnswerverifiedShow Answer

Refinancing a mortgage is recommended when:

Correct AnswerverifiedShow Answer

The date on which the repayment for a loan is due is called the ________ date.

Correct AnswerverifiedShow Answer

A valuable asset pledged to assure loan payments and which can be seized upon default is called:

Correct AnswerverifiedShow Answer

The uncertainty associated with decision-making is referred to as:

Correct AnswerverifiedShow Answer

What are four types of U.S.government securities? What are their maturity times,if any?

Correct AnswerverifiedSavings bonds,which vary in maturity for...View AnswerShow Answer

Savings compounded ________ would have the highest return on investment.

Correct AnswerverifiedShow Answer

Opportunity cost refers to:

Correct AnswerverifiedShow Answer

________ risk refers to the danger of lost buying power during times of rising prices.

Correct AnswerverifiedShow Answer

An investor wanting a low-risk source of income provided by an investment would choose:

Correct AnswerverifiedShow Answer

If the dollar price of a bond is $7,500 and the par value of the bond is $8,000,the interest rate is equal to:

Correct AnswerverifiedShow Answer

In the following table,fill in the missing values for a $15,000 one-year bond:

Correct AnswerverifiedShow Answer

Which bond rating does Standard & Poor's assign to a bond that is in default?

Correct AnswerverifiedShow Answer

Correct Answerverifieda.$7,496.50b.$7,735.75c.The interest r...View AnswerShow Answer

Renting is more advantageous than buying a home when you are seeking:

Correct AnswerverifiedShow Answer

The collection of securities and other investments owned by a mutual fund is called a(n) :

Correct AnswerverifiedShow Answer

________ is/are an example of an ownership investment.

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
Savings bonds,which vary in maturity for...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
a.$7,496.50
b.$7,735.75
c.The interest r...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified