Personal Finance Mid-Term Assessment Study Guide

What is the Rule of 72?

• Way to estimate how long to double your investment

• Compound Interest

• Investment Strategy

• Way to increase your savings 72 times

When a check that you've written clears the bank:

• Your account is credited and the balance increases

• Your account is debited and the balance increases

• Your account is credited and the balance decreases

• Your account is debited and the balance decreases

Which is an alert that you should enable on your bank account?

• Unusual Activity

• Low Balance

• Movile Deposit

• All of the Above

What is the FDIC?

• Federal Deposit Interest Company

• First Deposit Insurance Corporation

• Federal Deposit Insurance Corporation

• First Depository Interest Company

What is the amount of FDIC protection per bank account?

• $150,000

• $250,000

• $500,000

• $1,000,000

What is the difference between a checking and savings account?

• Checking is transactional; savings helps you grow your money over time

• Both are for everyday money transactions

• Savings is transactional; checking helps you grow your money over time

Which is interest paid on interest previously earned?

• Simple Interest

• Investment Interest

• Compound Interest

• Savings Interest

What is the time value of money?

• Money today is worth more than the same amount in the future due to its earning potential

• Money today is worth less than the same amount in the future due to its earning potential

Purpose of a Budget

• Plans your investment strategy

• Helps you to manage your income and expenses

• Helps you to prepare your income taxes

• Helps you to reconcile your bank account

In the 50-20-30 Rule of Budgeting, which does the 20% go toward?

• Needs

• Wants

• Savings