Financial Management Midterm Quiz #2

Financial management is only important for businesses, not for individuals

• True
• False

The time value of money means that money today is generally worth more than the same amount in the future

• True
• False

Saving money in a savings account is an example of a high-risk, high-return investment

• True
• False

A budget is a plan for how you will spend your money

• True
• False

"Needs" are things you must have to survive, while "wants" are things you desire but can live without

• True
• False

Investing in a new company's stock is generally considered a lower risk than putting your money in a savings account

• True
• False

Financial management involves making smart choices about spending, saving, and investing

• True
• False

Budgeting helps you control your spending and avoid getting into debt

• True
• False

The principle of risk and return suggests that there is no relationship between the amount of risk you take and the potential return you can earn

• True
• False

Good financial management means prioritizing your wants over your needs

• True
• False