Fin 008 - Personal Finance and Investments » Winter 2021 » Quiz 1

Need help with your exam preparation?

Existing Quiz Clients Login here
Question #1
An effect of deflation is that your money
A.   is worth less and buys less.
B.   is more stable.
C.   has less purchasing power.
D.   is less useful as a medium of exchange.
E.   is worth more and buys more.
Question #2
Which of the following individual situations typically leads to increased income needs, reduced risk tolerance, and greater need for future income protection?
A.   Responsibility for others
B.   Accumulation of assets
C.   Change of employment
D.   Retirement
E.   Investment
Question #3
Which of the following individual situations often leads to a reduction of both income and wealth?
A.   Retirement
B.   Investment
C.   Responsibility for others
D.   Change of employment
E.   Accumulation of assets
Question #4
If you had a budget deficit, the best way to reduce it among the following choices would be to
A.   invest more.
B.   spend more.
C.   work more.
D.   borrow more.
E.   save more.
Question #5
Personal finance is about all of the following processes EXCEPT
A.   creating income and wealth.
B.   protecting assets and wealth.
C.   managing income and wealth.
D.   acquiring and creating assets.
E.   preventing exposure to risks.
Question #6
Personal finance is about learning how to get what you want and how to protect what you've got.
A.   FALSE
B.   TRUE
Question #7
An example of a non-discretionary expense shown on an income statement is
A.   food, clothing, and shelter.
B.   education.
C.   gifts.
D.   taxes.
E.   entertainment.
Question #8
A summary of income and expenses over a period of time is called
A.   a cash flow statement.
B.   a budget.
C.   an income statement.
D.   net worth.
E.   a balance sheet.
Question #9
Bankruptcy occurs when there is negative net worth or
A.   lots of gambling debts.
B.   you default on a loan.
C.   debts are less than assets.
D.   there is postive net worth.
E.   debts are greater than assets.
Question #10
The Accounting Equation states that
A.   Assets = Income – Cash Flows.
B.   Assets + Debt = Liquidity
C.   Assets = Liabilities + Equity.
D.   Assets – Debt = Net Worth.
E.   Assets = Debt + Net Worth

Need help with your exam preparation?

Existing Quiz Clients Login here