Question 1

A financial planner who adheres to a fiduciary standard must always act in the best interest of the client regardless of how it might affect the advisor.

Accepted Answer

A) True 
 B)False

Question 2

In times of moderate to high inflation,people on fixed incomes suffer.

Accepted Answer

A) True 
 B)False

Question 3

Premiums paid by a worker for disability and long-term care insurance are often more expensive when purchased through one's employer.

Accepted Answer

A) True 
 B)False

Question 4

Housing values are appreciating at a rate of 3 percent a year.Approximately how much will your $100,000 house be worth in ten years if this rate of appreciation continues?​

Accepted Answer

A)   ​$134,390
B)   ​$146,320
C)   ​$155,080
D)   ​$174,410E) A) and B)
F) All of the above

Question 5

An example of inflation is an increase in the price of coffee or gasoline or some other commodity.

Accepted Answer

A) True 
 B)False

Question 6

An advantage of an employer-sponsored tax-sheltered retirement plan is the tax-deferred growth of contributions and earnings.

Accepted Answer

A) True 
 B)False

Question 7

Why do rising interest rates generally depress stock prices?​

Accepted Answer

A)   ​Businesses have to pay higher interest rates to borrow money,thus reducing their profits.
B)   ​Stock investors tend to take their money out of the stock market and invest in interest-paying investments.
C)   ​Future earnings will not be worth as much as today.
D)   ​All of these.E) A) and B)
F) None of the above

Question 8

Financial success is marked by having high wealth.

Accepted Answer

A) True 
 B)False

Question 9

Which of the following is primarily intended for those workers who select the high-deductible health plan (HDHP) offered by their employer?​

Accepted Answer

A)   ​Flexible spending account (FS
A)  
B)   ​Cafeteria plan
C)   ​Health savings account (HS
A)  
D)   ​Tax-deferred planE) A) and B)
F) A) and D)

Question 10

Opportunity costs are strictly financial in nature and do not involve personal tastes and preferences.

Accepted Answer

A) True 
 B)False

Question 11

The Great Recession that began in December,2007​

Accepted Answer

A)   ​lasted eighteen months.
B)   ​lasted 3 years.
C)   ​lasted 4 years.
D)   ​continues to this day.E) B) and C)
F) None of the above

Question 12

Financial success is defined as the achievement of​

Accepted Answer

A)   ​a financially secure retirement.
B)   ​financial aspirations that are desired,planned,or attempted.
C)   ​vast wealth.
D)   ​a comfortable lifestyle.E) A) and C)
F) B) and C)

Question 13

Some employee benefits are tax-sheltered,such as flexible spending accounts and retirement plans.

Accepted Answer

A) True 
 B)False

Question 14

A financial planner who makes recommendations solely based on the best interest of the client regardless of the impact on the planner is said to adhere to a​

Accepted Answer

A)   ​Fiduciary standard
B)   ​Fee-only standard
C)   ​Commision-only standard
D)   ​Suitability standardE) None of the above
F) A) and D)

Question 15

A condition of stagnant economic growth and high unemployment accompanied by rising prices is called​

Accepted Answer

A)   ​stagflation.
B)   ​deleveraging.
C)   ​implosion.
D)   ​inversion.E) A) and C)
F) All of the above

Question 16

The opportunity cost of a decision is the value of the next best alternative that must be foregone.

Accepted Answer

A) True 
 B)False

Question 17

Arvi,a college teaching assistant,received a raise of $800 from $18,000 to $18,800 this year.If inflation was 3 percent over the same period,which of the following is true?​

Accepted Answer

A)   ​Arvi's increase in real income was $800.
B)   ​Arvi's increase in real income was 4.4 percent.
C)   ​Arvi's increase in real income was $252.
D)   ​Arvi's decrease in real income was $252 percent.E) All of the above
F) B) and C)

Question 18

Present value is also known as discredited value.

Accepted Answer

A) True 
 B)False

Question 19

In times of high inflation,personal incomes generally keep up with the rate of inflation.

Accepted Answer

A) True 
 B)False

Question 20

A business cycle is a pattern of economic activity that includes an expansion,peak,contraction,and trough.

Accepted Answer

A) True 
 B)False

Exam 1: Understanding Personal Finance

Financial success is marked by having high wealth.

Correct AnswerverifiedShow Answer

An advantage of an employer-sponsored tax-sheltered retirement plan is the tax-deferred growth of contributions and earnings.

Correct AnswerverifiedShow Answer

Which of the following is primarily intended for those workers who select the high-deductible health plan (HDHP) offered by their employer?​

Correct AnswerverifiedShow Answer

The opportunity cost of a decision is the value of the next best alternative that must be foregone.

Correct AnswerverifiedShow Answer

A business cycle is a pattern of economic activity that includes an expansion,peak,contraction,and trough.

Correct AnswerverifiedShow Answer

A condition of stagnant economic growth and high unemployment accompanied by rising prices is called​

Correct AnswerverifiedShow Answer

Premiums paid by a worker for disability and long-term care insurance are often more expensive when purchased through one's employer.

Correct AnswerverifiedShow Answer

Some employee benefits are tax-sheltered,such as flexible spending accounts and retirement plans.

Correct AnswerverifiedShow Answer

An example of inflation is an increase in the price of coffee or gasoline or some other commodity.

Correct AnswerverifiedShow Answer

The Great Recession that began in December,2007​

Correct AnswerverifiedShow Answer

Opportunity costs are strictly financial in nature and do not involve personal tastes and preferences.

Correct AnswerverifiedShow Answer

A financial planner who makes recommendations solely based on the best interest of the client regardless of the impact on the planner is said to adhere to a​

Correct AnswerverifiedShow Answer

Present value is also known as discredited value.

Correct AnswerverifiedShow Answer

Financial success is defined as the achievement of​

Correct AnswerverifiedShow Answer

In times of moderate to high inflation,people on fixed incomes suffer.

Correct AnswerverifiedShow Answer

In times of high inflation,personal incomes generally keep up with the rate of inflation.

Correct AnswerverifiedShow Answer

A financial planner who adheres to a fiduciary standard must always act in the best interest of the client regardless of how it might affect the advisor.

Correct AnswerverifiedShow Answer

Why do rising interest rates generally depress stock prices?​

Correct AnswerverifiedShow Answer

Arvi,a college teaching assistant,received a raise of $800 from $18,000 to $18,800 this year.If inflation was 3 percent over the same period,which of the following is true?​

Correct AnswerverifiedShow Answer

Housing values are appreciating at a rate of 3 percent a year.Approximately how much will your $100,000 house be worth in ten years if this rate of appreciation continues?​

Correct AnswerverifiedShow Answer

Correct Answer
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Correct Answer
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Which of the following is primarily intended for those workers who select the high-deductible health plan (HDHP) offered by their employer?

Correct Answer
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Correct Answer
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Correct Answer
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A condition of stagnant economic growth and high unemployment accompanied by rising prices is called

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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The Great Recession that began in December,2007

Correct Answer
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Correct Answer
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A financial planner who makes recommendations solely based on the best interest of the client regardless of the impact on the planner is said to adhere to a

Correct Answer
verified

Correct Answer
verified

Financial success is defined as the achievement of

Correct Answer
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Correct Answer
verified

Correct Answer
verified

Correct Answer
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Why do rising interest rates generally depress stock prices?

Correct Answer
verified

Arvi,a college teaching assistant,received a raise of $800 from $18,000 to $18,800 this year.If inflation was 3 percent over the same period,which of the following is true?

Correct Answer
verified

Housing values are appreciating at a rate of 3 percent a year.Approximately how much will your $100,000 house be worth in ten years if this rate of appreciation continues?

Correct Answer
verified