Chapter 3- Money Management

The Hamilton household has 145,000 in assets and 63,000 in liabilities. What is the family's net worth?

• $82,000

• $227,000

• -$63,000

• -$82,000

Harold Daley budgeted $210 for food for the month of July. He spent $227 on food during July. Does he have a budget surplus or deficit, and what amount?

• Surplus, $17

• Deficit, $17

• Surplus, $10

• Deficit, $10

Calculate the "Total Assets"

Cash $4,670

Investment account $26, 910

Credit card debt $2,670

House value $93, 780

House mortgage- $76, 230

• $125,360

• $204,260

• $31,580

• $78,900

Calculate the "Total Liabilities"

Cash $4,670

Investment account $26, 910

Credit card debt $2,670

House value $93, 780

House mortgage- $76, 230

• $78,900

• $125,360

• $31,580

• $204,260

Calculate the "Net worth"

Cash $4,670

Investment account $26, 910

Credit card debt $2,670

House value $93, 780

House mortgage- $76, 230

• $78,900

• $31, 950

• $125,000

• $46,460

Which of the following is an asset?

• Electric bill

• Car loan

• Savings account

• Donation

Which of the following is a cash outflow?

• Monthly salary

• tips and commissions

• Rent for the month

• Cash in checking account

The family has liabilities of $128,000 and assets of $340,000. What is their debt ratio?

• 38%

• 2.65%

• 265%

• 0.376%

A good debt ratio would be.....

• > 50%

• <50%

• equal to 50%

• 50% or higher

Saving and investing for the future......

• reduces the amount you can spend now

• results in los interest earnings and an inability to use savings for other purposes

• reduces the amount of future income available for spending

• reduces long term financial security