final

Question 1

What is Personal Financial Planning?

Answer 1

The process of managing your money to achieve personal economic satisfaction.

This includes setting goals, budgeting, and managing investments.

Question 2

Define Goals in financial planning.

Answer 2

Specific things you want to achieve in the future, such as buying a house or saving for college.

Question 3

What is Opportunity Cost?

Answer 3

The value of what you give up when you make a choice.

Question 4

What does Economics study?

Answer 4

How individuals and societies use limited resources to satisfy unlimited wants.

Question 5

What is the Economy?

Answer 5

The system of production, distribution, and consumption of goods and services.

Question 6

What is the Federal Reserve System?

Answer 6

The central banking system of the U.S., which regulates money supply and interest rates.

Question 7

Define Inflation.

Answer 7

A rise in the general level of prices, which reduces purchasing power.

Question 8

Who is a Consumer?

Answer 8

A person who buys and uses goods and services.

Question 9

What is Interest?

Answer 9

The cost of borrowing money or the return on invested money.

Question 10

Explain the Time Value of Money.

Answer 10

The concept that money today is worth more than the same amount in the future due to its potential earning capacity.

Question 11

What is Future Value?

Answer 11

The amount of money an investment is worth after one or more periods.

Question 12

Define Present Value.

Answer 12

The current worth of a future sum of money, given a specific rate of return.

Question 13

What is Money Management?

Answer 13

Day-to-day financial activities and decisions.

Question 14

What are Personal Financial Statements?

Answer 14

Documents like income and expense statements or balance sheets that summarize financial data.

Question 15

What is a Personal Balance Sheet?

Answer 15

A financial statement that shows assets, liabilities, and net worth.

Question 16

Define Net Worth.

Answer 16

Assets minus liabilities.

Question 17

What are Assets?

Answer 17

Anything of value owned.

Question 18

What is Market Value?

Answer 18

The price at which you could sell an asset.

Question 19

Define Liabilities.

Answer 19

Debts or obligations owed to others.

Question 20

What does Insolvency mean?

Answer 20

When liabilities exceed assets.

Question 21

What is Income?

Answer 21

Money received, especially on a regular basis (e.g., wages, salary).

Question 22

What is Take Home Pay?

Answer 22

Net income after taxes and deductions.

Question 23

What is a Surplus?

Answer 23

When income exceeds expenses.

Question 24

Define Deficit.

Answer 24

When expenses exceed income.

Question 25

What is a Budget?

Answer 25

A plan for managing income and expenses.

Question 26

What is a Down Payment?

Answer 26

Initial amount paid upfront when buying on credit (like a house or car).

Question 27

Define Impulse Buying.

Answer 27

Buying something without prior planning or consideration.

Question 28

What is Unit Pricing?

Answer 28

Cost per unit of measure, used for comparison shopping.

Question 29

What is a Rebate?

Answer 29

A partial refund after purchasing an item.

Question 30

What is a Warranty?

Answer 30

A guarantee that a product will work as promised or be repaired/replaced.

Question 31

What is Fraud?

Answer 31

Intentional deception for financial gain.

Question 32

What is Mediation?

Answer 32

A neutral third party helps resolve a dispute.

Question 33

What is Arbitration?

Answer 33

A third party makes a legally binding decision to settle a dispute.

Question 34

What is Small Claims Court?

Answer 34

A legal venue to resolve minor disputes, usually involving small dollar amounts.

Question 35

What is an Automated Teller Machine (ATM)?

Answer 35

A machine used for banking transactions like withdrawals or deposits.

Question 36

What is a Commercial Bank?

Answer 36

A financial institution that offers services such as checking and savings accounts, and loans.

Question 37

What is a Certificate of Deposit (CD)?

Answer 37

A savings certificate with a fixed interest rate and maturity date.

Question 38

Define Annual Percentage Rate (APR).

Answer 38

The annual rate charged for borrowing or earned through an investment.

Question 39

What is Bank Reconciliation?

Answer 39

The process of matching your checkbook register with the bank statement.

Question 40

What does Credit mean?

Answer 40

Borrowing money with the promise to repay later.

Question 41

What is Closed-end Credit?

Answer 41

A one-time loan paid back over time in equal amounts (e.g., car loan).

Question 42

Define Open-end Credit.

Answer 42

Credit extended in advance, with varying payment amounts (e.g., credit cards).

Question 43

What is a Line of Credit?

Answer 43

A pre-approved amount of money you can borrow as needed.

Question 44

What is Net Income?

Answer 44

Income after taxes and deductions.

Question 45

What is Bankruptcy?

Answer 45

A legal process to relieve individuals or businesses of debt when they cannot pay it.

Question 46

What does Mobility refer to in financial terms?

Answer 46

The ability to move easily from place to place.

Question 47

Who is a Tenant?

Answer 47

A person who rents property.

Question 48

Who is a Landlord?

Answer 48

A person who owns property and rents it to others.

Question 49

What is a Lease?

Answer 49

A contract to rent property.

Question 50

Define Equity.

Answer 50

The value of ownership in property, calculated as property value minus debt.

Question 51

What is an Escrow Account?

Answer 51

An account where money is held in trust for property taxes and insurance.

Question 52

What is a Mortgage?

Answer 52

A loan used to purchase real estate.

Question 53

What does Closing refer to in real estate?

Answer 53

Final step in a real estate transaction when the title is transferred.

Question 54

What is a Deed?

Answer 54

Legal document that transfers property ownership.

Question 55

Define Tax Liability.

Answer 55

Total amount of tax owed to the government.

Question 56

What is an Estate Tax?

Answer 56

Tax on the transfer of property upon someone's death.

Question 57

What is an Inheritance Tax?

Answer 57

Tax imposed on someone who inherits property or money.

Question 58

What is Income Tax?

Answer 58

Tax on income earned by individuals and businesses.

Question 59

What is an Income Tax Return?

Answer 59

A form filed with the IRS to report income, expenses, and other tax-related info.

Question 60

Define Exclusion in the context of taxes.

Answer 60

Income that is not included in taxable income.

Question 61

What is Taxable Income?

Answer 61

Income used to calculate how much tax you owe.

Question 62

What is a Tax Deduction?

Answer 62

An expense that reduces your taxable income.

Question 63

What is a Standard Deduction?

Answer 63

A fixed amount that reduces taxable income, available to all taxpayers.

Question 64

Define Exemption.

Answer 64

A deduction allowed for yourself and dependents.

Question 65

What is an Allowance related to taxes?

Answer 65

Adjustments on a W-4 form that affect how much tax is withheld from your paycheck.

Question 66

What is a Tax Audit?

Answer 66

An IRS review of your tax return for accuracy.