MS Civics & Citizenship Part B Unit 4 Review

How are interest rates calculated by financial institutions?

 

Financial institutions generally calculate interest as ​ (a)   interest or ​ (b)   interest.

• simple
• compound
• terminal
• intermediate
• fluctuating
• divisional

Which activity is a part of personal financial planning?

•  

  planning for retirement

  
  

•  

  setting municipal budgets

  
  

•  

  investing in social security trust funds

  
  

•  

  investing in disaster relief funds (DRFs)

  
  

Financial choices revolve around three primary decisions: spending, saving, and _____________.

• sharing

• wasting

• refusing

• educating

Crystal wants the latest limited edition of Vogue magazine, but she needs to buy food for her family. Crystal prioritizes her needs over her wants. What will she most likely do?

•  

  Purchase the groceries, because that is her need.

  
  

•  

  Purchase the magazine, because it is a limited edition that she may not see again.

  
  

•  

  Purchase the magazine before it becomes outdated.

  
  

•  

  Purchase cheaper grocery items so she can still afford the magazine.

  
  

•  

  Purchase neither groceries nor the magazine.

  
  

What is the first step in financial planning?

•  

  understanding what you want

  
  

•  

  maintaining a log of all your expenses

  
  

•  

  preparing a balance sheet

  
  

•  

  attaching a goal cost to every goal

  
  

•  

  attaching a time frame to every goal

  
  

Joshua wants to set certain mid-term goals for himself. What kind of time frame would his goals need to qualify as mid-term goals?

•  

  one to five years

  
  

•  

  less than one year

  
  

•  

  five to eight years

  
  

•  

  one to two years

  
  

•  

  more than 10 years

  
  

Identify each personal account as either a deposit or a savings account. 

Groups:

(a) Deposit Account

,

(b) Savings Account

• certificate of deposit account

• Checking Account

• Transaction Account

• money market account

• Time deposit account

Which characteristic describes the privatization of Social Security?

•  

  enables Americans to invest their Social Security contributions in the stock market

•  

  increases the employer’s contribution to Social Security

•  

  raises the retirement age to claim full benefits to 70

•  

  reduces benefits across the board by 13 percent

•  

  obtains a loan from the Fed

When will the Social Security fund dry up at its current level?

• 2042

• 2097

• 2027

• 2117

Match each type of savings account with its features.

• schools often sponsor it

• Credit union account

• members own it

• Stock-indexed CD

• interest rate rise/fall w/ market

• Online account

• minimal overhead=higher interest rates

• Youth Savings Account