WorksheetsFoundations in Personal Finance Ch. 1
Total questions: 22
Worksheet time: 11mins
Expensive houses and new cars are a true indication of wealth.
True
False
Which of the following is not a reason credit is marketed heavily to consumers in the United States?
The credit industry has become extremely profitable.
The use of credit is not socially accepted in the United States
There is strong consumer demand for big ticket items
Since 1920, credit laws in the United States have been relaxed in an attempt to create a mainstream alternative to loan sharks for the working class.
An obligation of repayment owed by one party to a second party
Debt
Ownership
A fee paid by a borrower to the lender for the use of borrowed money.
Bills
Interest
The widespread financial insecurity of Americans is primarily because:
The incomes of Americans are low
Government programs are unavailable to help people when they are disabled or experience unemployment
The saving rate of Americans is low and many borrow in order to spend more than they earn
Most Americans save a high proportion of their income
Key components of financial planning include all of the following except:
Write out a detailed plan for accomplishing your goals.
Replace money myths with money truths.
Allow your financial planner to make all of your major money decisions.
Regularly monitor and reassess your financial plan.
Which of the following is a consequence of spending more than you make?
Missed opportunity to save and invest
Stress
A cycle of debt
All options
Most Americans avoid the use of credit when it comes to buying big-ticket items like a car or furniture for their home.
True
False
A person or business that offers loans at extremely high interest rates
Loan Shark
Creditor
When developing a personal financial plan, one of the first things you should do is assess your current financial situation. This includes your income, assets, and liabilities.
True
False
True financial security is achieved when your money begins to generate an income; your money starts working for you.
True
False
Why was the use of credit uncommon prior to 1917?
Laws prevented lenders from charging high interest rates
Borrowing money was generally not socially acceptable.
Lending money to others was not profitable
All options
Most Americans today are wealthy and will have financial security when they retire.
True
False
The knowledge and skillset necessary to be an informed consumer and manage finances effectively.
Financial literacy
Budgeting
A period of temporary economic decline during which trade and industrial activity are reduced; generally identified by a fall in gross domestic product (GDP)
Market Economy
Recession
Personal financial success is primarily the result of:
Managing your money behavior
Winning the lottery
Generous welfare and unemployment
Inheriting money from your parents
Since you are a teenager, what you do now with money will have little effect on your financial future.
True
False
A system by which goods and services are produced and distributed
Assets
Economy
The credit system today is structured to accommodate a state of uncertain employment and income instability, utilizing high interest rates and fees to turn huge profits.
True
False
Which of the following is not a true statement?
Americans learned to borrow amidst post-WWII prosperity.
The credit industry in America has not changed much since 1917.
After 1970, consumer debt skyrocketed.
As banks made higher profits, they were willing to lend more money to consumers.
The granting of a loan and the creation of debt; any form of deferred payment
Credit
Annual Fee
A fee paid by a borrower to the lender for the use of borrowed money
Bills
Interest
