Personal Financial Planning Final Exam Review

Suppose you want to set aside enough today to equal $15000 in 7 years. You expect to earn an interest rate of 4%. How much do you need o set aside today ?

• 25677

• 11339

• 11399

• 27560

If you believe you can earn 6% on your investment and want to save $1,200,000 for retirement, how much do you set aside on your investment over each of the next 40 years to meet your goal ? Assume you set aside your saving payment once per year.

• 9803

• 7754

• 5477

• 4598

If you invested $1,000 8 years ago and that investment is now worth $2,000, what annualized rate of return did you earn each year ? (convert your answer to decimal form. Round to two decimal places. For example, 6.3% would be recorded as 0.06 )

• 0.08

• 0.10

• 0.07

• 0.09

How many years will it take an investment to double in value if you earn an 8% rate of return ? ( Rule of 72 ; T = 72/R)

• 9

• 10

• 11

• 12

If you buy a car for a total purchase price of $25,000, financed fully with an auto loan for 5 years at a 6% annual interest rate, what will be your monthly car payment ? ( Car Loan Calculator )

• 485

• 760

• 483

• 525

Which of the following is true ?

• Your Income Statement states all your financial information

• Net Worth = Assets - Liabilities

• Your statement of Cash Flows shows your income less expense for a given period

• Your Statement of Net With would list your credit card balance as a liability

Suppose Chloe owns a cat. What is true about her cat ?

• Chloe should budget for expenses associated with the cat

• The cat will appear as an asset on Chloe's Statement of Cash Flows

• The cat will likely never crave the cheese sitting on Chloe's kitchen counter. Never

• All of the answers are correct

If Eli owns a house that is worth $150,000, the following is true:

• The house should appear as a $150,000 cash inflow on his annual Statement of Cash Flows

• The house has no effect on his financial statements

• The house is an Asset on his statement of Net Worth

• The house makes his Net Worth less positive

In Personal Finance, TVM stands for:

• Tempestuous Vaulting Mammal

• Temporal Valuation Maneuver

• Time Money Value

• Transformation Vector Malfunction

If Cecilia has $5000 in monthly salary, $4000 in her checking account, and an upcoming student loan repayment of $1,000, and a mortgage balance of $50,000, what is the total amount of her Current Assets ?

• $50,000

• $4,000

• $1,000

• $5,000