Question 1

Increased demand for a product or service will usually result in lower prices for the item.

Accepted Answer

A) True 
 B)False

Question 2

Household size is a major influence on personal financial planning decisions.

Accepted Answer

A) True 
 B)False

Question 3

What is the future value of $20,000 received today, after 10 years if it is invested at 6% compounded annually for the next six years and 5%, compounded semi-annually for the remaining four years?

Accepted Answer

A)  $25,000
B)  $31,000
C)  $32,772
D)  $34,567
E)  $38,817F) A) and E)
G) None of the above D

Question 4

Risks associated with most financial decisions are difficult to measure.

Accepted Answer

A) True 
 B)False

Question 5

Future value calculations consider:

Accepted Answer

A)  compounding.
B)  add-on interest.
C)  discounting
D)  simple interest.
E)  an annuity.F) B) and D)
G) C) and D)

Question 6

Changes in interest rates don't affect your financial planning.

Accepted Answer

A) True 
 B)False

Question 7

An individual invests $9,000 at a rate of 6% per annum.What will be its value in 11 years' time?

Accepted Answer

A)  $15,000
B)  $15,853
C)  $16,289
D)  $18,000
E)  $17,085F) C) and E)
G) B) and E)

Question 8

Time value of money refers to changes in consumer spending when inflation occurs.

Accepted Answer

A) True 
 B)False

Question 9

Economic Factor: Money supply measures?

Accepted Answer

A)  The value of the dollar; changes in inflation
B)  The demand for goods and services by individuals and households
C)  The cost of money; the cost of credit when you borrow; the return on your money when you save or invest
D)  The dollars available for spending in our economy
E)  The number of people without employment who are willing and able to workF) B) and D)
G) A) and E)

Question 10

Your life situation is affected by which of the following?

Accepted Answer

A)  Buying a car
B)  Vacations
C)  Getting a raise at work
D)  Retirement
E)  GradesF) B) and C)
G) C) and D)

Question 11

Analyzing your current financial position is a part of the first stage of the financial planning process.

Accepted Answer

A) True 
 B)False

Question 12

A financial plan is also known and referred to as a budget.

Accepted Answer

A) True 
 B)False  False

Question 13

A higher opportunity cost implies a lower current value.

Accepted Answer

A) True 
 B)False

Question 14

The main economic influence that determines prices is:

Accepted Answer

A)  the stock market.
B)  supply and demand.
C)  employment.
D)  government spending.
E)  interest ratesF) A) and D)
G) A) and B)

Question 15

Opportunity costs refer to time, money, and other resources that are given up when a decision is made.

Accepted Answer

A) True 
 B)False  True

Question 16

Reduced funds available for investment in our economy could result from

Accepted Answer

A)  expanded savings by consumers.
B)  higher imports than exports.
C)  reduced spending for consumer goods.
D)  higher exports than imports.
E)  higher opportunity costs.F) None of the above
G) C) and E)

Question 17

Economic Factor: Consumer prices measures?

Accepted Answer

A)  The value of the dollar; changes in inflation
B)  The demand for goods and services by individuals and households
C)  The cost of money; the cost of credit when you borrow; the return on your money when you save or invest
D)  The dollars available for spending in our economy
E)  The number of people without employment who are willing and able to workF) C) and E)
G) A) and E)

Question 18

Economic Factor: Housing starts measures?

Accepted Answer

A)  The value of the dollar; changes in inflation
B)  The demand for goods and services by individuals and households
C)  The cost of money; the cost of credit when you borrow; the return on your money when you save or invest
D)  The dollars available for spending in our economy
E)  The number of new homes being builtF) C) and D)
G) A) and C)

Question 19

If a person deposited $10,000 earning 9 percent for 11 years, this would involve what type of computation?

Accepted Answer

A)  simple interest
B)  future value of a single amount
C)  future value of a series of deposits
D)  present value of a single amount
E)  present value of a series of depositsF) C) and D)
G) B) and C)

Question 20

Life situation Young dual income no children What are your specialized financial activities?

Accepted Answer

A)  Consider home purchase.
B)  Obtain adequate amounts of health, life, and disability insurances.
C)  Consider tax-deferred contributions to retirement fund.
D)  Consolidate financial assets and review estate plans
E)  Consider income splittingF) All of the above
G) A) and D)

Exam 1: Personal Financial Planning: An Introduction

Increased demand for a product or service will usually result in lower prices for the item.

Correct AnswerverifiedShow Answer

Household size is a major influence on personal financial planning decisions.

Correct AnswerverifiedShow Answer

What is the future value of $20,000 received today, after 10 years if it is invested at 6% compounded annually for the next six years and 5%, compounded semi-annually for the remaining four years?

Correct AnswerverifiedD

Risks associated with most financial decisions are difficult to measure.

Correct AnswerverifiedShow Answer

Future value calculations consider:

Correct AnswerverifiedShow Answer

Changes in interest rates don't affect your financial planning.

Correct AnswerverifiedShow Answer

An individual invests $9,000 at a rate of 6% per annum.What will be its value in 11 years' time?

Correct AnswerverifiedShow Answer

Time value of money refers to changes in consumer spending when inflation occurs.

Correct AnswerverifiedShow Answer

Economic Factor: Money supply measures?

Correct AnswerverifiedShow Answer

Your life situation is affected by which of the following?

Correct AnswerverifiedShow Answer

Analyzing your current financial position is a part of the first stage of the financial planning process.

Correct AnswerverifiedShow Answer

A financial plan is also known and referred to as a budget.

Correct AnswerverifiedFalse

A higher opportunity cost implies a lower current value.

Correct AnswerverifiedShow Answer

The main economic influence that determines prices is:

Correct AnswerverifiedShow Answer

Opportunity costs refer to time, money, and other resources that are given up when a decision is made.

Correct AnswerverifiedTrue

Reduced funds available for investment in our economy could result from

Correct AnswerverifiedShow Answer

Economic Factor: Consumer prices measures?

Correct AnswerverifiedShow Answer

Economic Factor: Housing starts measures?

Correct AnswerverifiedShow Answer

If a person deposited $10,000 earning 9 percent for 11 years, this would involve what type of computation?

Correct AnswerverifiedShow Answer

Life situation Young dual income no children What are your specialized financial activities?

Correct AnswerverifiedShow Answer

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D

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False

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True

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