Personal Finance Final Review

If you needed to save $2160 for your first semester of college which starts in 18 months, how much would you have to save each month?

• $50

• $100

• $120

• $150

What you pay to use another person’s money

• Credit

• Debit

• Interest

• Collateral

A period of time before interest starts accumulating on charged purchases (You get to use someone else's money for free during this time)

• Collateral

• Grace Period

• Policy Period

• Credit

A reference of how you have used credit in the past.

• Collateral

• Credit Report/Credit Score

• Personal Reference

• Interest Rate

Under the Fair Debt Collection Act, creditors are allowed charge a new debt collection fee without informing the borrower notice.

• True

• False

Why is compound interest more advantageous than simple interest?

• Compound interest is harder to calculate, so those who use it earn higher profits for their efforts

• Compound interest means you have a fund manager who is compounding your returns without charging a fee

• Compound interest allows you to earn interest not only on the amount you have saved, but also on the interest you've already earned

• Compound interest has lower fees than simple interest

How can someone make money from investing in a stock?

• They sell the stock for a lower price than what they bought it for.

• They receive dividends from the company they bought the stock of and/or they sell the stock at a higher price than what they bought it for.

• The stock loses value but the overall market experiences a positive return.

• They sell the stock for the same price they bought it for.

Which type of risk management strategy is this an example of: You purchase insurance so they pay some of the cost to replace your car if it gets stolen.

• Avoid

• Reduce

• Accept

• Share

Which type of insurance do you NOT need to purchase?

• Travel

• health/disability

• car

• home/renters

What is the amount of wages you need to report on your 1040? (Box 1)

• 50,000

• 35,000

• 40,000