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WorksheetsPersonal Finance
Total questions: 73
Worksheet time: 40mins
What is personal financial planning?
Arranging to spend, save, and invest money to retire comfortably, have home security, and acquire insurance
Arranging to spend, save, and invest money to live comfortably, have financial security, and get a car
Arranging to spend, save, and invest money to live comfortably, have financial security, and achieve goals
All of the above
What are goals?
Things you want to obtain
Things you want to accomplish
Things you need
How to get a life
What are values?
The weight of an object
Beliefs and principles you consider a need
Beliefs and principles you consider important, correct, and desirable
All of the above
What is a need?
Something you must have to survive (food, shelter, clothing)
Food
Shelter
Clothing
All of the above
What is a want?
Water
Food
Something you must have to survive
Something you desire or would like to have or do
What is an opportunity cost?
What is given up when making one choice instead of another
What is obtained when making one choice instead of another
What is liquidity?
The ability to easily convert financial assets into checks without loss in value
The ability to easily convert financial assets into cash without loss in value
What is a service
A task that only a machine performs for you
A task that a person or a machine performs for you
A task that only a person machine performs for you
What is a good?
It is always a need
A physical item that is produced and can be weighed or measured
It is always a want
What is a consumable good?
A physical item that is produced and can be weighed or measured
Purchases that you make often and use up quickly
Something you desire or would like to have or do
The ability to easily convert financial assets into cash without loss in value
What is a durable good?
Expensive items that last three years or more when used on a regular basis
Purchases that you make often and use up quickly
A physical item that is produced and can be weighed or measured
A task that a person or a machine performs for you
What are smart goals?
Specific
Measurable
Achievable
Realistic
Time-based
Successful
Measurable
Achievable
Realistic
Time-based
Specific
Measurable
Achievable
Responsible
Time-based
Specific
Measurable
Achievable
Realistic
Teachable
What is economics?
The study of the decisions that go into making, distributing, and using goods and services; the study of the allocation of scarce resources
The study of the decisions that go into making, distributing, and using goods and services; the study of scarce resources
The study of the decisions that go into making and using goods and services; the study of scarce resources
What is supply?
The amount of needs and wants available for sale
The amount of goods and services available for the environment
The amount of goods and services available for sale
The amount of things available for sale
What is demand?
The amount of needs people are willing and able to buy
The amount of wants people are willing and able to buy
The amount of goods and services people are willing and able to sell
The amount of goods and services people are willing and able to buy
What is the Federal Reserve System?
The central banking organization of the United States
Regulates the money supply
Determines interest rates
Buys and sells government securities
All of the above
What is inflation?
The same as inflammation
The rise in the level of prices for goods and services
All of the above
None of the above
What is interest?
The price that is cut off for the use of another’s money
The price that is paid for the use of another’s money
The amount that is paid for the use of another’s stuff
What are examples of personal opportunity costs?
Health
Knowledge
Skills
Time
All of the above
What is a safe-deposit box?
A large secure storage compartment that you can rent in a bank
A small, secure storage compartment that you can rent in a person’s house
A small, secure storage compartment that you can rent in a bank
What might you keep in home files? A safe-deposit box? On a home computer?
Home files: receipts and other financial papers that are not hard to replace
Home computer - Certain financial records (lists of transactions, digital documents, budget/tax software)
Home files - receipts and other financial papers that are not hard to replace
All of the above
What is a personal financial statement?
A check that provides information about an individual’s current financial position and presents a summary of income and spending
A document that provides information about an individual’s current financial position and presents a summary of income and spending
A document that provides information about an individual’s past financial position and presents a summary of income and spending
What is a personal balance sheet?
Net worth statement
A financial statement that lists items of value owned, debts owed, and a person’s net worth
All of the above
A financial statement that lists items of value owned, loans, and a person’s salary
What is the net worth
All your assets
The difference between the amount that you owe and the amount you own
The difference between the amount that you own and the debts that you owe
An abundance of valuable material possessions or resources
What is an asset?
Any item of value that an individual or company owns
An abundance of valuable material possessions or resources
A small, secure storage compartment that you can rent in a bank
The rise in the level of prices for goods and services
What are the 4 categories of wealth
Liquid assets, real estate, personal possessions, investment assets
Bill gates
Different types of side hassles
What is insolvency
A financial state that occurs if incomes are less than assets
A financial state that occurs if incomes are greater than assets
A financial state that occurs if liabilities are less than assets
A financial state that occurs if liabilities are greater than assets
Cash flow is divided into cash inflow (income) and cash outflow (spending)
True
False
What is a deficit
The outflow is drastic
More is being earned than spent
More is being spent (outflow) than is being earned (inflow)
The inflow is drastic
What is a bond?
A type of stock that gives the owner the advantage of receiving cash dividends
before common stockholders
The written pledge of a corporation, government, or municipality to repay a specific sum of money with interest
A unit of ownership of a company
An investment in which investors pool their money to buy stocks, bonds, and other securities selected by professional managers
What is a mutual fund?
A type of stock that gives the owner the advantage of receiving cash dividends before common stockholders
An investment in which investors pool their money to buy stocks, bonds, and other securities selected by professional managers
The written pledge of a corporation, government, or municipality to repay a specific sum of money with interest
The process of spreading your assets among several different types of investments to reduce risk
What is the goal of investing in real estate?
A type of insurance that covers the loss of a tenant’s personal property as a result of damage or theft, or medical/legal expenses caused by accidental injuries suffered on your premises
The cost of credit on a yearly basis, expressed as a percentage; the annualized
interest rate on a credit account
Having an increased APR for a predetermined period of time
To own property that increases in value so that you can sell it at a profit, or to receive rental income
What is diversification?
The process of spreading your assets among several different types of investments to reduce risk
Legal responsibility for the financial cost of another person’s losses or injuries
The failure to take ordinary or reasonable care to prevent accidents from
happening
Anything that may cause a loss
What is insurance?
A portion of the total cost that is required at the time of purchase
A type of insurance that covers the loss of a tenant’s personal property as a result of damage or theft, or medical/legal expenses caused by accidental injuries
suffered on your premises
A measure of a person’s ability and willingness to make credit payments on time
Protection against possible financial loss through a contract called a policy
The risks ranked lowest to highest is
1. Savings
2. Bonds
3. Mutual Funds
4. Stocks
True
False
What is net pay?
The amount of income you get paid
The taxes and deduction that are taken from your grooms pay
The amount of income left after taxes and other deductions are taken out of your gross pay
The amount of money in a net
What is discretionary income?
The money left over after paying for the essentials
The money left over before paying for the essentials
Money you have
What is a budget?
Money you have
Money you don't have
Money for things you want
A plan for using money to meet wants and needs
What is a good budget?
Carefully planned
Practical
Flexible
Written and easily understood
How does overdraft protection on a checking account work?
If you overdraw your account, the bank takes away your credit card
If you overdraw your account, the bank covers the purchase and charges you a fee plus the amount of the coverage
If you overdraw your account, the bank covers the purchase and gives it to you for free
What are common banking fees?
Out of network ATM fee
Overdraft fee
Minimum balance fee
Mayonnaise fee
What is a check?
A document used to make a payment to an individual or business
A document used to take money from an individual or business
Savings have
Higher interest rates
Limited access
Used for an emergency fund or to save for a goal
All of the above
Checking has
ATM withdrawals, writing checks
Debit card takes funds directly from account
Hard transfers to pay fees
Multiple answers are correct
What is a bank statement?
A list of all transactions for a bank account, according to you
A list of all transactions for a bank account, according to the bank
A list of all transactions for a bank account, according to your parents
What is a checkbook register?
A list of all transactions for a bank account, according to the bank
A list of all transactions for a instagram account, according to the individual account holder
A list of all transactions for a bank account, according to the individual account holder
What is a deposit slip?
A document used to take money from an account
A document used to put money into an account
What is a bank reconciliation?
A report that accounts for the differences between the bank statement and a checkbook balance
A report that accounts for the similarities between the bank statement and a checkbook balance
A report that accounts for the differences between the bank statement and credit card balance
What is direct deposit?
An automatic deposit of gross pay to an employee’s designated bank account
A deposit of gross pay to an employee’s designated bank account
A manual deposit of net pay to an employee’s designated bank account
An automatic deposit of net pay to an employee’s designated bank account
What are the disadvantages of online banking?
Easy to transfer money between accounts or pay bills
Mobile deposit of checks using your phone’s camera
Easy to keep track of your balance
No answers are correct
What transactions reduce the balance of a checking account?
Paying with a check
Paying with a debit card
Withdrawing from an ATM
Digitally transferring money from the account
How does compound interest work?
Interest is lost on both the original amount you took out and any previously earned interest
Interest is earned on both the original amount you deposited and any previously earned interest
How should compound interest impact your long-term financial strategy?
If you begin saving/investing late, there is more time for earnings to accumulate - the most significant factor in the power of compounding is time
If you begin saving/investing early, there is more time for earnings to accumulate - the most significant factor in the power of compounding is time
If you begin saving/investing early, there is more time for earnings to accumulate - the most significant factor in the power of compounding is money
What is the annual percentage rate?
The cost of credit on a monthly basis, expressed as a percentage; the monthly interest rate on a credit account
The cost of credit on a weekly basis, expressed as a percentage; the weekly interest rate on a credit account
The cost of credit on a yearly basis, expressed as a percentage; the annualized interest rate on a credit account
The cost of credit on a daily basis, expressed as a percentage; the daily interest rate on a credit account
What may be a consequence of missing a credit payment?
Can’t buy clothes
Paying a fee
Take away your credit card
Increased APR for a predetermined period of time
What are the five C’s of credit?
Character, capacity, capital, collateral, conditions
Character, capacity, citizenship, conditions, capital
When you make a purchase on credit, are you using your own money?
Yes. You must use the money in your account for the purchase, plus any additional interest
No. You must pay the credit company the amount of the purchase, plus any additional interest
What is a credit rating score?
A measure of a person’s ability and willingness to make credit payments late
A measure of a person’s money to make credit payments
A measure of a person’s ability and willingness to make credit payments on time
How is credit score improved?
Make payments on time
Make payments late
Do not pay down credit cards that are near the credit limit
Prioritize paying down credit cards that are near the credit limit
What is the tradeoff between a short loan with high monthly payments and a longer loan with lower monthly payments?
The higher monthly payments are more affordable to afford, but result in paying more interest over the course of the loan
The lower monthly payments are more affordable in the short-term, but lead to paying more in interest over the course of the loan
The higher monthly payments are more difficult to afford, but result in paying less interest over the course of the loan
The lower monthly payments are more difficult to afford, but result in paying less interest over the course of the loan
What is a security deposit?
An amount of money paid to the owner of the property by a tenant to guard against any financial loss or damage that the tenant might cause
An amount of money paid to the tenant of the property by a owner to guard against any financial loss or damage that the tenant might cause
When the tenant moves out, the landlord must return the deposit, minus any charges for damage caused or unpaid rent
When the tenant moves out, the landlord must return the deposit, plus any charges for damage caused or unpaid rent
What is renters insurance?
A type of insurance that covers the loss of a owner’s personal property as a result of damage or theft, or medical/legal expenses caused by accidental injuries suffered on your premises
A type of insurance that covers the loss of a tenant’s personal property as a result of damage or theft, or medical/legal expenses caused by accidental injuries suffered on your premises
What is a down payment?
A portion of the total cost that is required after the purchase
A portion of the total cost that is not at the time of purchase
A portion of the total cost that is required at the time of purchase
What is a real estate agent?
A person who arranges the sale and purchase of homes and other property
A person who arranges the homes and other property
What is a common stock
A unit of ownership of a company that entitles the stockholder to voting privileges
A unit of ownership of a company that entitles the stockholder to pay dividends from company profits
A unit of ownership of a company that entitles the stockholder to voting privileges and may pay dividends from company profits
What is a preferred stock?
A type of stock that gives the owner the advantage of receiving cash dividends before common stockholders
A type of stock that gives the investor the advantage of receiving cash dividends before common stockholders
What is a hazard?
Anything that increases the likelihood of gain
Anything that increases the likelihood of loss
What is negligence?
The success of taking ordinary or reasonable care to prevent accidents from happening
The failure to take abnormal or unreasonable care to prevent accidents from happening
The failure to take ordinary or reasonable care to prevent accidents from happening
What is a deductible?
The set amount that the policyholder does not have to pay per loss on an insurance policy
The set amount that the policyholder must pay per loss on an insurance policy
What are four risk management methods?
Risk shifting - transferring risk to an insurance company for a premium
Risk assumption - taking on responsibility for the negative results of a risk
Risk avoidance - avoiding situations involving a particular risk altogether
Risk reduction - reducing the likelihood of harm
What is a liability?
Legal responsibility for the mental cost of another person’s losses or injuries
Responsibility for the financial cost of another person’s gains
Legal responsibility for the emotional cost of another person’s losses or injuries
Legal responsibility for the financial cost of another person’s losses or injuries
What does collision insurance cover?
Damage to the person of the vehicle, regardless of who is at fault
Damage to the vehicle of the insured person, regardless of who is at fault
Damage to the vehicle of the insured person, depending on who is at fault
Damage to the person of the vehicle, depending on who is at fault
What might cause differences in insurance premiums for the same coverage?
Perceived differences in risk
Car quality
Location
History of the policy holder
