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WorksheetsPOBF 4.00-5.00 Review 6-2-15
Total questions: 50
Worksheet time: 25mins
Name
Class
Date
1.
Mary prefers a relatively safe investment that will allow her to withdraw money after a few days without losing any of her principal. Which is the best investment choice for Mary?
a)
Bond investment
b)
Certificate of deposit
c)
Money market account
d)
stock investment
2.
Some customers recently learned that they can exchange quilts purchased from Tyson’s Antique Store over 25 years ago for higher prices than they were originally purchased. Which type of investment are the quilts?
a)
Collectibles
b)
Commodities exchanges
c)
Currency
d)
Gold, silver, and precious metals
3.
How much interest is earned on a balance of $1,000 for a certificate of deposit that is compounded at an 8% interest rate for an account maintained for three years?
a)
$135.00
b)
$241.30
c)
$259.71
d)
$301.89
4.
A store relocated to a larger building with plans to increase its profits and target market. This is an example of which type of insurance risk?
a)
Controllable
b)
Non-economic
c)
Speculative
d)
Uninsurable
5.
Sam prefers a savings plan that allows him to earn interest on previously earned interest. Which type interest does he prefer?
a)
Compound
b)
Money market
c)
Simple
d)
Variable
6.
How are common and preferred stocks similar?
a)
Both pay limited dividend payments.
b)
Both have a risk of loss of a investment.
c)
Both have the same amount of risk
d)
Both stockholders have voting rights
7.
Bob sells specialty guitars and hopes to exchange the guitars for a much higher value than the purchase price. Which type of investment could the guitars become?
a)
Collectibles
b)
Commodities and futures
c)
Commodity exchanges
d)
Gold, silver, and precious metals
8.
Walden Book Store obtained information about Ann’s reputation for paying her bills. Which factor examined by creditors did the store receive?
a)
Credit application
b)
Credit report
c)
Receipts
d)
Statement of account
9.
A bank loaned Doug $4,500 for 24 months. Which type of credit did he accept?
a)
Charge account
b)
Consumer loan
c)
Credit card
d)
Installment credit
10.
Which is an example of a service provided by a credit bureau?
a)
Credit counseling for customers
b)
Credit reports to other businesses
c)
Statement of accounts to customers
d)
Credit applications to applicants
11.
Ted issued credit cards to all his employees so they could charge necessary products and services that are work related. Which advantage is Ted most likely to accomplish by viewing the monthly statement of account for the credit cards?
a)
Earn rewards
b)
Establish favorable credit rating
c)
Keep track of spending
d)
Monitor theft of customer records/database
12.
Jenny has the option of borrowing $300 at a 3% interest rate. Which loan option would cost her the most money?
a)
Option 1: loan for 2 months
b)
Option 2: loan for 3 months
c)
Option 3: loan for 6 months
d)
Option 4: loan for 1 year
13.
While shopping among several stores, Tina charged over $700 worth of home improvement supplies. Which type of credit did Tina use?
a)
Charge account
b)
Consumer loan
c)
Credit card
d)
Installment credit
14.
Ted deposits money in a savings plan regularly. The interest he earns on this plan is indicative of how the money markets are doing. Which savings plan is he using?
a)
Bond investment
b)
Certificate of deposit
c)
Money market account
d)
Savings account
15.
Mary’s business has $5,000 to start a savings plan at a local bank. She is comparing the interest rates between a mutual fund and a regular savings account. Which evaluation factor of saving is Mary considering?
a)
Liquidity
b)
Potential return
c)
Safety and risk
d)
Taxes
16.
Jack is reviewing his investment portfolio to make sure it includes options that will allow him to access money immediately. Which type of evaluation factor of saving is he considering?
a)
Liquidity
b)
Potential return
c)
Safety and risk
d)
Taxes
17.
How much interest is earned on a balance of $1,800 that is compounded semiannually at a 6% interest rate for an account maintained for one year?
a)
$109.62
b)
$110.00
c)
$154.00
d)
$175.00
18.
Mary needs a savings plan that will allow her to access her money as cash for potential emergency needs. Which type of evaluation factor of saving is she considering?
a)
Liquidity
b)
Potential return
c)
Safety and risk
d)
Taxes
19.
Justin paid $20 at the end of a doctor’s visit and agreed to pay the balance in 30 days. He will avoid any cost for this credit. Which type of credit did Justin use?
a)
Charge account
b)
Consumer loan
c)
Credit card
d)
Installment credit
20.
Mary makes prearranged equal payments monthly to Progress Energy. Which type of credit did Mary use?
a)
Charge account
b)
Consumer loan
c)
Credit card
d)
Installment credit
21.
JCPenney makes sure all applicants are creditworthy before issuing any of them credit cards. JCPenney is adhering to which regulation?
a)
Consumer Credit Reporting Reform Act
b)
Equal Credit Opportunity Act
c)
Fair Credit Billing Act
d)
Fair Credit Reporting Act
22.
A bank loaned Doug $4,500 for 24 months. Which type of credit did he accept?
a)
Charge account
b)
Consumer loan
c)
Credit card
d)
Installment credit
23.
After talking with a Sears customer representative about her overdue balance, Tina implemented a strategy that will minimize her debt. Tina used which type of credit assistance?
a)
Bankruptcy
b)
Credit counseling
c)
Credit repair
d)
Debt repayment plan
24.
While shopping among several stores, Tina charged over $700 worth of home improvement supplies. Which type of credit did Tina use?
a)
Charge account
b)
Consumer loan
c)
Credit card
d)
Installment credit
25.
ABC Rental Company requires applicants to verify reputation for paying bills in order to determine potential credit risk. Which factor examined by creditors does the company require?
a)
Credit application
b)
Credit contract
c)
Credit report
d)
Statement of account
26.
What is the interest amount for the following loan: $10,000 car loan for 5 years at 8% interest rate?
a)
$400
b)
$3,000
c)
$4,000
d)
$5,000
27.
A Sears Department Store sales associate gave a customer a form to complete in order to apply for a credit card. Which factor examined by creditors did the customer receive?
a)
Credit application
b)
Credit bureau credit report
c)
Documentation of credit data
d)
Three C's of credit
28.
Chase Mortgage Company sends quarterly summaries of transactions. Which type of document does the company send?
a)
Business credit application
b)
Credit report
c)
Personal credit application
d)
Statement of account
Statement of account
29.
Tonya is considering shopping at a Rooms To Go furniture store that advertises the option of payments for a period of three years. Which type of payment option was advertised?
a)
Charge account
b)
Consumer loan
c)
Credit card
d)
Installment credit
30.
Sky Blue Credit Repair Company assists clients with spending less on debt and eliminating credit problems. Which type of credit assistance does the company provide?
a)
Bankruptcy
b)
Credit counseling
c)
Credit repair
d)
Debt repayment plan
31.
Han sued a furniture store that verified it provided inaccurate information about his credit history. Which regulation would protect him in having the information corrected?
a)
Consumer Credit Reporting Reform Act
b)
Equal Credit Opportunity Act
c)
Fair Credit Reporting Act
d)
Fair Debt Collections ActFair Debt Collections Act
Fair Debt Collections ActFair Debt Collections Act
32.
Which is an example of content for a credit contract?
a)
Repair services fee may apply statement
b)
June 5th due date for payment
c)
$450 worth of merchandise transaction
d)
May 5th date of last transaction
33.
Capital Bank reported that John has both savings and checking accounts with its financial institution. Which factor for granting credit related to documentation is this institution’s action?
a)
Credit Application
b)
Credit bureau credit report
c)
Credit data
d)
Three C’s of credit
34.
Josh maintained minimum living expenses while working on his job for the past six years. Which ‘C’ of credit is he most likely to meet?
a)
Capacity
b)
Capital
c)
Character
d)
Contract
35.
Jenny charged $300 worth of gifts while shopping at several stores. Which type of credit did Jenny use?
a)
Charge account
b)
Consumer loan
c)
Credit card
d)
Installment Credit
36.
Using the attached figure, what is the maturity date for a loan made on February 1 and due in 15 days?
a)
February 1st
b)
February 14th
c)
February 16th
d)
February 28th
February 28th
37.
Mary paid only $50 for unauthorized charges made to her Capital One MasterCard. Which regulation protected her?
a)
Equal Credit Opportunity Act
b)
Fair Credit Billing Act
c)
Fair Credit Billing Act
Fair Credit Billing Act
d)
Truth in lending law
38.
Which is an example of a service provided by a credit bureau?
a)
Credit counseling for customers
b)
Credit reports to other businesses
c)
Statement of accounts to customers
d)
Credit applications to applicants
39.
Fred’s Electric Company receives daily over thirty service orders. The company’s manager refers some of the orders to another company, since she wants to maintain a reputation of completing orders in a timely manner. How does the company handle the risks?
a)
Assume
b)
Avoid
c)
Insure
d)
Transfer
40.
Which is an example of uninsurable risks?
a)
Ford Motor Company claims damages of cars as necessary.
b)
Josh overhauls machine motors.
c)
Tammy travels to Texas to negotiate contracts for steel beams.
d)
A competitor of The Red Box is concerned about it renting movies for only $1.
41.
ABC Investment Company invested over $300,000 obtained from their clients. The company gained 5% as a return on its investment. This is an example of which type of insurance risk?
a)
Controllable
b)
Economic
c)
Insurable
d)
Speculative
42.
It would cost a cosmetic company at least $1.49 for each bottle in order to produce a new line of shampoo. The company decided to continue with its original production instead of adding the new product. How did the company handle the potential risks?
a)
Assume
b)
Avoid
c)
Insure
d)
Transfer
43.
Cashiers can now manage several registers from a computerized station that will allow several customers to check out their groceries at one time. Which uninsurable risk is this?
a)
Consumer Demand
b)
Economic conditions
c)
Local factors
d)
Technology change
44.
Which is an example of uninsurable risks?
a)
FedEx covers property damaged by its drivers.
b)
Kroger Grocery Store has liability coverage.
c)
PDQ’s competitors are now picking up packages from residential homes.
d)
Tessa is receiving compensation after being injured at work.
45.
Many newspapers are experiencing fewer subscribers since more subscribers are now obtaining news from the Internet. This is an example of which type uninsurable risk?
a)
Business operations
b)
Economic conditions
c)
Local factors
d)
Technology change
46.
The Electronics Company hires local delivery companies to set up equipment. How does the company handle the risks of setting up equipment?
a)
Assume
b)
Avoid
c)
Insure
d)
Transfer
47.
The Whole Foods Market provides workshops on how to prepare healthy meals. During the past three months, the attendance increased over 40%. This is an example of which type uninsurable risk?
a)
Consumer demand
b)
Economic conditions
c)
Local factors
d)
Technology change
48.
A sales associate encouraged customers to try on outfits in order to have experiences with the clothes. He planned for the experiences to convince the customers to purchase the clothes. This is an example of which type of insurance risk?
a)
Insurable
b)
Non economic
c)
Speculative
d)
Uninsurable
49.
A real estate agent has the responsibility to showcase several homes in order to sell to potential customers. How is the agent currently handling the risks?
a)
Assume
b)
Avoid
c)
Insure
d)
Transfer
50.
What do insuring personnel and property have in common?
a)
Both provide coverage for cost of risks.
b)
Both provide coverage for day-to-day routines.
c)
Both provide coverage for long-term care.
d)
Both provide coverage for loss of investments.
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