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Unit 2 Review

Total questions: 20

Worksheet time: 10mins

Name
Class
Date
1.

The Rule of 72 provides a quick formula for computing how long it will take to double money invested at a given interest rate.

a)

True

b)

False

2.

Risk transfer might be achieved by purchasing insurance.

a)

True

b)

False

3.

Health insurance provides income to a person who is unable to work due to a work-related illness or injury.

a)

True

b)

False

4.

A budget is similar to a cash flow statement because both are used to record estimated income and expenses.

a)

True

b)

False

5.

Bank checking and savings accounts are insured up to the legal limit of $250,000 per depositor per bank.

a)

True

b)

False

6.

The first step in the decision-making process is to

a)

Compare choices

b)

Define the problem or goal

c)

Gather information

d)

Consider the opportunity cost

7.

____________ is a common internet scam that uses email messages to deceive you into disclosing personal information.

a)

Identify theft

b)

Web fraud

c)

Phishing

d)

Hacking

8.

An auto insurance policy provides liability coverage of 100/300/50. What is the amount of property damage covered by this policy?

a)

$300,000

b)

$100,000

c)

$50,000

d)

$0

9.

__________ is a government-sponsored health insurance program funded by employee payroll deduction and matching employer contributions.

a)

Medicare

b)

Medicaid

c)

Medigap

d)

All of these

10.

Homeowners insurance covers property owners' losses from all the following except

a)

Depreciation

b)

Hazards

c)

Crimes

d)

Liability

11.

Debit cards carry all the same protections provided with credit cards.

a)

True

b)

False

12.

Group life insurance makes it possible for individuals who would not qualify for an individual policy have life insurance.

a)

True

b)

False

13.

An umbrella policy is so named because it provides liability coverage above that of your homeowners and car insurance.

a)

True

b)

False

14.

Which of the following is the most liquid?

a)

Savings account

b)

Money Market Account

c)

Certificate of Deposit

d)

Savings Bond

15.

Which type of insurance coverage protects against damage to your own vehicle when you are at fault in hitting another car?

a)

Liability coverage

b)

Collision coverage

c)

Comprehensive coverage

d)

Personal injury protection

16.

Your net worth can be computed as

a)

Assets plus liabilities

b)

Cash inflows minus cash outflows

c)

Assets minus liabilities

d)

Assets mines cash outflows

17.

The amount of money a person has to spend after needs are met is called

a)

Net cash flow

b)

Discretionary income

c)

Net worth

d)

Disposable income

18.

What type of auto insurance are you required to have by Nebraska Law?

a)

Collision insurance

b)

Comprehensive insurance

c)

Liability insurance

d)

Under/uninsured insurance

19.

What type of additional auto insurance can you purchase that covers your car if you are hit by a driver without insurance?

a)

Liability insurance

b)

Under/uninsured insurance

c)

Comprehensive insurance

d)

Collision insurance

20.

Self-insuring is an example of which risk strategy?

a)

Risk Reductions

b)

Risk avoidance

c)

Risk transfer

d)

Risk assumption