(PF) Ch. 6 Test Review

When you buy a house, the smaller your down payment, the ___ your monthly mortgage payments will be.

• lower

• higher

Convenience of location and the services offered is NOT usually a reason people often choose a particular financial institution.

• True

• False

Which of the following savings options imposes a penalty if money is withdrawn early?

• savings account

• certificate of deposit

• stocks

• money market account

Stocks and bonds issued by corporations or by the government are called share accounts.

• True

• False

The biggest advantage of scholarships is

• that they are only for students with highest GPAs.

• that they do not have to be repaid if you complete your education.

• that they do not have to be repaid until after you graduate from college.

• none of the above

The more liquid an investment, the ___earning potential it is likely to have.

• less

• more

The more often interest is compounded, the ___ your interest earnings will be.

• lesser

• greater

Stocks represent debt, or a loan; bonds represent equity, or ownership.

• True

• False

Earnings on principal is called _____.

• investment

• taxes

• interest

• none of the above

A typical down payment for a house is about 10-20 percent of the purchase price.

• True

• False