Test 1 Part 1 Flashcards
(30 cards)
What does a collection agency usually refer to?
A business that pursues payments of debts owed by individuals or businesses.
To garnish a person’s wages means to do which of the following?
To take extra money from their paycheck for legal reasons related to debt that is owed.
Financially, the term grace period is usually associated with which of the following?
Allows payment to be received for a certain period of time after the actual due date.
How many years will it take to pay off $1,600 in credit card debt at 18% and making minimum payments of 3%? Use the Credit Card Calculator under the Financial Websites tab.
10.25 Years
How many years will it take to pay off $10,000 in credit card debt at 18.9% and making minimum payments of 3%? Use the Credit Card Calculator under the Financial Websites tab.
21.3 Years
What is a scam?
A dishonest way of making money by cheating people
When an asset increases in value compared to the original purchase price, then this is known as which of the following?
Capital Gain
In financial terms, what does compensation refer to?
All of the above
Which of the following is the best example of diversification?
Buy stock from ten different companies.
Which of the following is the best example of a mutual fund?
Owning 5 Shares of a stock portfolio that includes 30 different companies in the portfolio.
Which of the following are examples of philanthropy?
Giving a lot of money to a charitable cause.
Which of the following is an example of fraud?
Making up expenses on your tax return so you won’t have to pay the government as much money.
Use the Compound Interest Calculator under the Financial Websites Tab. If you put $1,000 in the stock market and invest another $1,000 in the stock market each year for 40 years at an average interest rate of 8.5%, then how much money will you accumulate after 40 years?
Over $340,000
Use the Compound Interest Calculator under the Financial Websites Tab. If you put $1,000 in the stock market and earn 8.5% interest each year, then how much money will you have after 40 years?
Around $26,000
What is the difference between leasing and buying a car?
If you want a new car and don’t drive too many miles, leasing can be a better deal for some people.
What is the problem with having a budget of $6,000 a month and a income of $60,000 per year.
The expenses of $6,000 per month are greater than the monthly income.
What is GDP?
Gross Domestic Product
If the CPI index becomes higher, how does this affect inflation?
Inflation will usually become higher.
When inflation is high, which of the following is true?
Answers A and B.
What is the Federal Reserve?
It is the central bank of the United States and it determines monetary policy.
If you make $12 and hour and work a regular 40 hour week, then approximately how much money will you earn in a month before taxes (gross income)?
Approximately $2000
If you plan on spending $480 per year on clothes, how much should you budget per month for clothes?
$40
What is the main purpose of a budget?
All of the above.
Microsoft’s share price is much less than Apple. Which of the following is true?
It just means each share of Microsoft is less expensive but it doesn’t tell you which company is a better company.
