PFL Unit 1

Financial Planning is:

• A strategy for achieving long-term financial goals

• A document that tracks daily spending

• A list of expenses for the month

• A plan to spend money on non-essential items

What is the opportunity cost of buying a $1.75 Powerade every school day for one year instead of drinking water? Assume you are in school for 38 weeks and water is free?

• $332.50

• $250.00

• $400.00

• $300.00

Millie listed her jewelry and her vehicle as ______ on her bank loan and listed her $800 mortgage payment as a Liability on the same application.

It is more important to prioritize (a)   such as basic living expenses and debt payments over (b)   like entertainment and luxury purchases when managing personal finances.

• needs
• wants
• assets
• goods

A person increases their _______ when they make weekly deposits in their savings accounts.

• liquidity

• debt

• expenses

• liabilities

Which of the following is not an example of "cash outflow"?

• A. Cam buying movie tickets.

• B. Cam receiving a $100 gift card.

• C. Cam paying for his auto insurance.

• D. Cam purchasing stocks in Apple.

Short term goals are usually achieved with (a)   .

• 5 yrs.

• 10 yrs.

• 1 yr.

When investing $10,000, which scenario represents the most "risk" for your investment?

• Depositing your money in your savings account

• Investing in a start-up company.

• Purchasing a well-maintained vehicle.

• Purchasing property

Juan's monthly truck payment is considered a ______.

• fixed expense

• variable expense

• discretionary expense

• savings

Leon used money from his savings account for a down payment on an ATV. Money in his savings account is an example of a(n) (a)   .

• Liquid Assets

• Fixed Assets

• Current Liabilities

• Long-term Liabilities