SLO review

Front

Interpret which of the following statements best explains why income alone does not determine wealth: A. Investing is the only factor that contributes to wealth building. B. Income alone does not determine a person’s wealth. C. Only people who are natural savers can become wealthy. D. The amount of money a person makes does not dictate his or her spending and saving behavior.

Back

Income alone does not determine a person’s wealth.

Front

Describe the main reason of widespread financial insecurity of Americans.

Back

The saving rate of Americans is low and many borrow in order to spend more than they earn.

Front

Which of the following is the best reason to save money?
A. emergency fund
B. large purchases
C. lend money to friends
D. build wealth

Back

build wealth

Front

This principle suggests that a certain amount of money today has different buying power than the same amount of money in the future, thereby changing the “value” of the money.

Back

time value of money

Front

______5) Decide which of the following account records would have the most current balance.
Options: A. your monthly bank statement, B. your own account register, C. account balance statement from ATM, D. checkbook

Back

your own account register

Front

Distinguish what a credit score is intended to measure: A. your financial success, B. your income level, C. the risk of not repaying debt, D. the amount of money you have in the bank

Back

the risk of not repaying debt

Front

Which of the following things can be done with a credit card but can’t be done with a debit card?
A. reserve a hotel room
B. go into debt
C. purchase tickets
D. purchase something online

Back

go into debt

Front

What happens when a company places an ad and offers no interest on your purchase for three years?

Back

the cost of financing is built into the price of the item

Front

Which concept is best explained by the statement “Money spent here cannot be spent there”?

Back

opportunity cost

Front

Describe liquidity.

Back

the more liquid the investment, more return