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Personal Finance Cumulative Exam Review

Total questions: 20

Worksheet time: 24mins

Name
Class
Date
1.

Reg has just purchased a new car. The car had a list price of $22,499, and he was responsible for 7.96% sales tax, a $2,138 vehicle registration fee, and a $262 documentation fee. Reg’s financing has an interest rate of 10.27%, compounded monthly, and a duration of three years. If Reg makes a monthly payment of $773.89, which of the following was his down payment? Round all dollar values to the nearest cent.

a)

$2,000

b)

$2,200

c)

$2,500

d)

$2,800

2.

Tyrell has a bankruptcy on his credit report and therefore pays higher interest rates on his current loans. He calculates that the extra money he pays in additional interest each year, if invested at the rate of 2.5% for one year, could earn him simple interest totaling $300. How much does Tyrell pay in additional interest each month?

a)

$90

b)

$100

c)

$1,000

d)

$12,000

3.

A password is 4 characters long and must consist of 3 letters and one number. If letters cannot be repeated and the password must end with a number, how many possibilities are there?

a)

175,760

b)

158,184

c)

156,000

d)

140,400

4.

The Lopez family is putting $275 monthly into a savings account for Verona’s college education. The family anticipates they will need to contribute $10,000 toward her first year of college, which is in 3 years. Which best explains whether or not the family can expect to have enough money after saving for 3 years ? Assume the savings account accrues interest

a)

The family will not have enough money. They will have saved only $8,250.

b)

The family will not have enough money. They will have saved only $9,900.

c)

The family will likely have enough money. They will have saved $8,250 and have accumulated interest.

d)

The family will likely have enough money. They will have saved $9,900 and have accumulated interest.

5.

This year, the annual tuition at a public four-year university is $5,290. Next year when Jarrod attends his first year, the tuition is expected to increase 4.5%. Jarrod has 1 year to save the amount of money equal to the tuition for his first year. What is the approximate minimum amount Jarrod should save monthly?

a)

$441

b)

$461

c)

$553

d)

$639

6.

Yasmine plans to attend a four-year public university. She expects she will need to contribute $9,000 annually to her education. Which savings plan will help Yasmine save enough money to pay for one year of school, regardless of whether or not interest is earned on her savings?

a)

$600 per month for 1 year

b)

$350 per month for 2 years

c)

$225 per month for 3 years

d)

$200 per month for 4 years

7.

Ariel wants to compare the salaries for positions she was offered at two companies. What should she consider in this process? Check all that apply.

a)

She should research the cost of living of different locations to compare against the offered salaries.

b)

She should research the benefits included in each offer.

c)

She should research the average salary of similar positions to see if the offers are fair.

d)

She should take the position that offers the largest salary.

e)

She should take the position that has the lowest cost of living.

8.

In the wrong hands, which of the following pieces of personal information would present the greatest risk for identity theft?

a)

address

b)

date of birth

c)

mother’s maiden name

d)

social security number

9.

Which describes the difference between a personal loan and a credit card?

a)

Credit cards offer lump sums of money, while personal loans set a maximum amount a person can borrow.

b)

Credit cards are secured loans for large amounts, while personal loans are unsecured for small purchases.

c)

Personal loans offer lump sums of money, while credit cards set a maximum amount a person can borrow.

d)

Personal loans are secured for small purchases, while credit cards are unsecured loans for large amounts.

10.

Which information can be found on a person’s credit report? Check all that apply.

a)

an unpaid utility bill that has been given to a collection agency

b)

the person’s credit rating

c)

the person’s yearly income

d)

the person’s social security number

e)

an inquiry from a bank that requested the person’s credit report

11.

Emily is deciding whether to buy the same designer jacket her friends have. The jacket is much more expensive than a similar one from a lesser-known brand. Which questions should she consider before she buys the jacket? Check all that apply.

a)

Is advertising influencing her?

b)

What are her motivations?

c)

Has she compared prices?

d)

Is she buying at the right time?

e)

Will her sister like the jacket too?

12.

Which statement best describes lifetime income?

a)

the total salary for all the years worked

b)

the total salary and retirement benefits for all the years worked

c)

the total salary and value of insurance benefits for all the years worked

d)

the total cost of college classes and vocational training divided by the total years worked

13.

If having a warranty on a car is important, a person should buy a car that is ...

(a)  

14.

In some cases, it is safe to avoid insurance because

a)

it is too expensive.

b)

it may not be needed.

c)

one already has enough savings.

d)

one is already in debt.

15.

What term is used to describe an individual's money and personal property?

a)

budget

b)

income

c)

assets

d)

finances

16.

In which column on a check register should the total current amount in the account be entered?

a)

Deposit

b)

Transaction

c)

Balance

d)

Debit

17.

Companies report people to credit agencies if they

a)

fail to pay their bills on time.

b)

borrow too much money.

c)

fail to use different types of credit.

d)

use large amounts of credit at once.

18.

The level of investment in markets often indicates

a)

the stability of the government.

b)

the state of the economy.

c)

the success of individual companies.

d)

the stability of a currency.

19.

A person’s credit score can range from a low of 300 to a high of what number?

(a)  

20.

A mortgage is a legal agreement between a borrower and a

a)

city agency.

b)

family court judge.

c)

wealthy relative.

d)

bank.