Money Matters: Semester 2 Exam (Ch. 12-24) - Odd
Multiple Choice
Identify the
choice that best completes the statement or answers the question.
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Ch. 23 Health and Life
Insurance
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1.
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The maximum duration of benefits under most disability policies is until
a. | you die | c. | age 65 | b. | age 40 | d. | age 50 |
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2.
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All of the following are common types of permanent life
insurance _except
a. | universal life | c. | convertible life | b. | whole life | d. | limited-pay
life |
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3.
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Government-sponsored health insurance for people with low incomes is
called
a. | Medicaid | c. | a managed care plan | b. | Medicare. | d. | a fee-for-service
plan |
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4.
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This law allows people who leave employment to continue their health insurance
under the company plan for a limited period of time.
a. | COBRA | c. | Medicare | b. | Medicaid | d. | HIPPA |
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5.
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The savings accumulated in a permanent life insurance policy that you would
receive if you canceled your policy is called
a. | cash value | c. | premium value | b. | face value | d. | par value |
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6.
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Which of the following is NOT a requirement under the Affordable Care
Act?
a. | Health plans cannot place a limit on lifetime benefits. | b. | Patients can choose
their own primary care doctors. | c. | Health plans cannot limit or deny benefits due
to a preexisting condition. | d. | All covered medical services must be provided
without co-pays. |
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Ch. 14: Buying & Owning a
Vehicle
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7.
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In most cases, the most important factor in determining a car’s resale or
trade-in value is
a. | the vehicle’s fuel efficiency. | c. | mechanical
condition. | b. | model popularity. | d. | the vehicle’s age. |
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8.
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Which of the following vehicles would most likely have the highest insurance
rate?
a. | used mini-van | c. | fuel-efficient compact car | b. | new sports
car | d. | four-door family
sedan |
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9.
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Typically, you should expect to change the oil in your vehicle every three
months or every _____ miles, whichever comes first.
a. | 20,000 to 30,000 | c. | 3,000 to 5,000 | b. | 7,000 to 10,000 | d. | 10,000 to
15,000 |
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10.
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Monthly car payments should be no more than _____ percent of the money you have
left after paying all of your other expenses.
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11.
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All of the following websites allow you to search for specific models of new and
used cars available in your area except
a. | Kelley Blue Book | c. | Cars.com | b. | Consumer Reports | d. | Auto Trader |
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Ch. 12 - Renting a Residence
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12.
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An on-campus building that contains many small rooms that are rented out to
students is called a
a. | hostel. | c. | dormitory. | b. | duplex. | d. | condominium. |
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13.
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Which of the following consists of four bedrooms connected to a single kitchen
and living room that is shared by the occupants?
a. | townhouse | c. | studio | b. | quad | d. | condo |
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14.
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Many utility companies charge new customers a(n)
a. | installation surcharge. | c. | refundable security
deposit. | b. | one time nonrefundable fee | d. | none of the above. |
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15.
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In a typical roommate arrangement, all of the following expenses would be shared
equally by all of the roommates except
a. | utilities. | c. | laundry services | b. | rent. | d. | cable TV. |
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16.
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Which of the following would generally be considered an advantage of renting as
compared to owning a home?
a. | tax benefits | c. | fewer responsibilities | b. | less
noise | d. | more
privacy |
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17.
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Which of the following is probably NOT a question you need to ask of a
prospective roommate?
a. | What do you like to do for fun? | c. | Do you have a
job? | b. | When is your birthday? | d. | Are you a smoker? |
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18.
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The monthly charge you pay to live in an apartment is called
a. | a lease. | c. | rent. | b. | a mortgage. | d. | a security
deposit. |
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19.
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Which of the following is an obligation of the lessor?
a. | provide a dwelling that is habitable | b. | give at least 30-days’ notice of intent
to move | c. | pay the rent on or before the due date | d. | all of the above are obligations of the
lessor |
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Ch 19 - Mutual Funds, Real Estate, and Other
Choices
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20.
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Advantages of investing in mutual funds include all of the following
except
a. | a guaranteed rate of return | c. | liquidity | b. | diversification | d. | professional management |
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21.
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A professionally managed group of investments bought using a pool of money from
many investors is called a
a. | Ponzi scheme | c. | savings bond | b. | passbook account | d. | mutual fund |
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22.
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A building with two separate living quarters is called a
a. | duplex | c. | triplex | b. | quad | d. | condo |
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23.
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Which of the following is the most risky investment?
a. | money market fund | c. | income fund | b. | growth and income fund | d. | growth fund |
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24.
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Which of the following is a sales charge paid when you sell an
investment?
a. | dividend | c. | front-end load | b. | back-end load | d. | capital gain |
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25.
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Farm products (such as wheat, corn, and cattle) and metals (such as gold and
silver) are called
a. | futures | c. | options | b. | commodities | d. | collectibles |
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26.
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Which of the following tells you the market price for a share of a mutual
fund?
a. | face value | c. | par value | b. | net asset value | d. | market value |
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Ch. 20 Retirement and Estate
Planning
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27.
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A tax-deferred retirement plan available to small businesses is a
a. | Keogh plan | b. | money market plan | c. | Simplified Employee
Pension (SEP) plan | d. | defined-benefit
plan |
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28.
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Many financial advisers suggest that you will need between __________ percent of
your preretirement income to live comfortably
a. | 95 and 100 | c. | 50 and 60 | b. | 60 and 75 | d. | 75 and 85 |
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29.
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A legal document authorizing someone to act on your behalf is called a
a. | power of attorney | c. | inter vivos | b. | codicil. | d. | joint tenancy
agreement |
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30.
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A will written in a person’s own handwriting is called a
a. | holographic will | c. | codicil | b. | simple will. | d. | trust will. |
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31.
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Social Security replaces about ____ percent of an average wage earner's
income after retiring.
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32.
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The amount for which you could sell your home now is its
a. | true value | c. | appraised value | b. | assessed value | d. | current market
value |
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Ch 18. Investing In Bonds
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33.
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A type of corporate bond based on the general creditworthiness of the company is
called a(n)
a. | mortgage bond. | c. | annuity | b. | debenture | d. | secured bond |
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34.
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Corporations usually agree not to call bonds for the first ___ years after
issuance.
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35.
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When bonds sell for more than their face value, they are selling at a
a. | capital gain | c. | premium | b. | cut rate. | d. | discount |
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36.
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Which of the following types of bonds cannot be purchased through
TreasuryDirect?
a. | Series I savings bonds | c. | Series EE savings bonds | b. | corporate
bonds | d. | Treasury
securities |
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37.
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When a bond issuer cannot meet the interest and/or principal payments, what has
occurred?
a. | short selling | c. | bond default | b. | hedging | d. | bond redemption |
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38.
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The amount a bondholder will be paid at maturity is called
a. | dividend. | c. | face value | b. | yield. | d. | market value. |
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Ch 22: Property and Liability
Insurance
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39.
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Which of the following items would NOT be covered by most homeowners insurance
policies?
a. | all of the above would be covered | c. | a car stereo | b. | living room
furniture | d. | kitchen
appliances |
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40.
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The cost of replacing an item regardless of its actual cash value is
called
a. | opportunity cost | c. | exclusionary costs | b. | the deductible | d. | replacement
value. |
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41.
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Which of these people would be considered an uninvited guest on your
property?
a. | a plumber who comes to fix a leaking faucet in your bathroom | b. | your brother, who
you’ve asked to come watch the ballgame with you | c. | the letter carrier who delivers your
mail | d. | a burglar who breaks into your house to rob it |
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42.
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The most complete homeowners insurance policy coverage is called
a. | special form | c. | comprehensive | b. | broad form | d. | basic |
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43.
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Which type of auto insurance protects your own car against damage from auto
accidents?
a. | comprehensive | c. | collision | b. | personal injury protection | d. | liability |
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44.
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Automobile insurance premiums are based on a number of different factors. Which
of the following would NOT be one of those factors?
a. | location of the driver | c. | occupation of the driver | b. | model of the
car | d. | age of the
driver |
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45.
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This type of risk includes the cost of another person’s losses for
injuries at your property.
a. | liability | c. | hazards | b. | crimes | d. | perils |
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Ch 16 - Investing for the
Future
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46.
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Which of the following is typically the first stage of investing?
a. | a put-and-take account | c. | speculation | b. | strategic investing | d. | systematic
investing |
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47.
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All of the following are wise investment practices except
a. | make your decisions quickly to take advantage of the market | b. | define your
financial goals | c. | seek good investment advice | d. | keep good financial
records |
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48.
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Which of the following would be considered the lowest risk
investment?
a. | a stock | c. | real estate | b. | an annuity | d. | a corporate
bond |
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49.
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The use of long-term savings to earn a financial reward is called
a. | diversifying | c. | gambling | b. | speculating | d. | investing |
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50.
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A daily newspaper that provides detailed coverage of the business and financial
world is
a. | The Wall Street Journal | c. | Kiplinger’s Personal
Finance. | b. | Barron’s | d. | The Economist |
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Ch 21: Introduction to Risk
Management
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51.
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A condition that creates or increases the likelihood of some loss is called
a
a. | probability | c. | hazard | b. | peril | d. | proof of loss |
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52.
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Understanding the types of risk you will face and their potential consequences
is called
a. | risk administration | c. | risk assessment | b. | risk analysis | d. | risk management |
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53.
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In which period of the business cycle has the economy hit the bottom?
a. | recovery | c. | trough | b. | peak | d. | recession |
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54.
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Buying insurance is an example of
a. | risk avoidance | c. | risk assumption | b. | risk reduction | d. | risk shifting |
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55.
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Under an insurance policy, the insurer agrees to assume an identified risk when
the policyholder pays a fee called the
a. | premium | c. | exclusion | b. | claim | d. | benefit |
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56.
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All of the following types of insurance protect against personal risk
except
a. | property insurance | c. | life insurance | b. | disability insurance | d. | health
insurance |
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57.
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Which of the following techniques is not recommended for a serious
risk?
a. | shift the risk | c. | assume the risk | b. | reduce the risk | d. | avoid the risk |
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Ch 15 Family Decisions
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58.
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An advance commitment to receive a service at a specified later date is
a(n)
a. | reservation | c. | itinerary | b. | contract | d. | agenda |
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59.
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Guests as well as the wedding party would be expected to wear long gowns and
tuxedos at a(n)
a. | formal wedding | c. | informal wedding | b. | destination wedding | d. | semiformal
wedding |
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60.
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Which of the following wedding expenses would most likely be paid by the
groom?
a. | cleric’s or judge’s fee | c. | the bride’s
ring | b. | the marriage license | d. | all of the above |
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61.
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Money paid by one former spouse to support the other is called
a. | alimony | c. | child support | b. | the dissolution fee | d. | property
settlement |
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62.
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The final statement of a dissolution decision is called a
a. | property settlement | c. | Petition for Dissolution of Marriage | b. | support
statement | d. | divorce
decree |
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Ch. 17 - Investing in Stocks
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63.
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Which of the following would be considered an odd lot of stocks?
a. | 100 shares | c. | 50 shares | b. | 1,000 shares | d. | 200 shares |
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64.
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Current Profit on Stock ÷ Purchase Price + Commission =
a. | Net Yield | c. | Interest Rate | b. | Earnings per Share | d. | Return on
Investment |
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65.
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An increase in the value of a stock over time is called a(n)
a. | dividend | c. | yield | b. | capital gain | d. | investment |
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66.
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Stocks in young, often small corporations that have higher overall risk than
stocks of successful, long-established companies are called
a. | blue chip stocks | c. | defensive stocks | b. | growth stocks | d. | emerging stocks |
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67.
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The price of a share of stock divided by the corporation’s earnings over
the past 12 months is the
a. | P/E ratio | c. | earnings per share | b. | percent yield | d. | ROI |
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Ch 24 - Role of Consumers in a Market
Economy
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68.
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A minimum wage law is an example of a
a. | transfer payment | c. | price fix | b. | price floor | d. | price ceiling |
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69.
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The American airline industry is an example of
a. | an oligopoly | c. | a monopoly | b. | pure competition | d. | an oligarchy |
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70.
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Collectively, the production of goods and services in the U.S. economy is
directed by
a. | the government | c. | advertising and marketing strategies | b. | consumer buying
decisions | d. | producers and
suppliers |
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71.
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Which of the following would be considered a hands-on economic system?
a. | communism | c. | laissez-faire | b. | mixed economy | d. | libertarianism |
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72.
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An electronics store advertises a television for $150 just to get customers into
the store; salespeople then try to get customers to buy a much more expensive model. This is an
example of
a. | low-balling | c. | deceptive pricing | b. | bait and switch | d. | a “fake
sale.” |
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73.
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A fraudulent investment operation in which money collected from new investors is
used to pay off earlier investors is a
a. | phishing scam | c. | Ponzi scheme | b. | pyramid scheme | d. | pigeon drop |
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74.
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The price at which the quantity supplied equals the quantity demanded of the
product is the
a. | market price | c. | price floor | b. | equilibrium price | d. | breakeven price |
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75.
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The safest way to shop on the Internet is by using a credit card or __________
on a secure site.
a. | a check | c. | cash | b. | a prepaid gift card | d. | a debit card |
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Ch 13. Buying a Home pp.
297-313
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76.
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For purposes of computing property taxes owed against your home, the city or
county in which you live sets a(n) _____ value on the property.
a. | estimated | c. | market | b. | assessed | d. | appraised |
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77.
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A serious intent to be bound to an agreement is a(n)
a. | acceptance. | c. | offer. | b. | proposal. | d. | contingency. |
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78.
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Legally established ownership of property is a
a. | deed. | c. | tenancy agreement. | b. | lien, | d. | title. |
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79.
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Mortgage lenders usually offer lower interest rates in exchange for higher
discount points. Whether or not this is a good deal depends mostly on
a. | how long you plan to keep your house. | b. | the amount of equity you have in the
house. | c. | the sales price of the house. | d. | the amount of your down
payment. |
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80.
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A fund where money is held to pay amounts that will come due during the
year—such as property taxes and property insurance—is called a(n)
a. | mortgage. | c. | escrow account. | b. | trust deed. | d. | money market
account. |
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