Multiple Choice Questions Question 1. 1. (TCO 1) After a lengthy job search, Judy Smith has found a place of employment; however, it is demanding and she is required to work long hours during the week and even on weekends, leaving little time for outside interests. Her decision to work at this job is an example of (Points : 4)        deflation.        financial opportunity cost.        personal opportunity cost.        time value of money.        inflation. Question 2. 2. (TCO 1) Jack Johnson is interested in purchasing new furniture that currently costs $2,000. He is not sure if he can afford the furniture now, but is afraid the cost of the furniture will increase to $3,000 in 6 months. Which type of risk is Jack worried about? (Points : 4)        Inflation risk        Interest rate risk        Income risk        Personal risk        Liquidity risk Question 3. 3. (TCO 1) Question 3. 3. (TCO 1) Which step in the financial planning process is demonstrated by a situation in which Royanne partially retires and travels to Europe using less costly transportation in order to save more money for the trip? (Points : 4)        Developing her financial goals        Identifying alternative courses of action        Evaluating her alternatives        Implementing her financial plan        Reviewing and revising her financial plan Question 4. 4. (TCO 1) When you only have to pay taxes on an investment at a future point in time, this is referred to as a(n) (Points : 4)        cafeteria-style benefit.        vesting.        tax-deferred benefit.        tax-exempt benefit.        exclusion. Question 5. 5. (TCO 1) Through research, Martin Jones has learned that the housing market will begin to pick up over the next few years, creating the need for more real estate agents. This is an example of _____ influencing jobs in the future. (Points : 4)        demographic trends        economic conditions        industry trends        geographic trends        educational trends Question 6. 6. (TCO 1) For January, Bethany DeWeese had cash inflows of $4,210 and cash outflows of $4,770, resulting in a (Points : 4)        balanced budget.        deficit of $560.        surplus of $560.        surplus of $4,210.        deficit of $650. Question 7. 7. (TCO 1) Sherry O'Neal is interested in opening a savings account and her bank offers several types. Her main concern is that she wants to have the ability to withdraw her money whenever she wants. She has an interest in opening an account that is best categorized as (Points : 4)        money management.        an opportunity cost.        a limited asset.        a liquid asset.        net worth analysis. Question 8. 8. (TCO 1) When formulating a budget, _____ should be the very first item taken into account. (Points : 4) variable expenses        vacation expenses        fixed expenses        unplanned living expenses        recreation expenses Question 9. 9. (TCO 2) The _____ tax is an additional tax that m.

1. Multiple Choice Questions
Question 1. 1. (TCO 1) After a lengthy job search, Judy Smith
has found a place of employment; however, it is demanding and
she is required to work long hours during the week and even on
weekends, leaving little time for outside interests. Her decision
to work at this job is an example of (Points : 4)
deflation.
financial opportunity cost.
personal opportunity cost.
time value of money.
inflation.
Question 2. 2. (TCO 1) Jack Johnson is interested in purchasing
new furniture that currently costs $2,000. He is not sure if he
can afford the furniture now, but is afraid the cost of the
furniture will increase to $3,000 in 6 months. Which type of
risk is Jack worried about? (Points : 4)
Inflation risk
Interest rate risk
Income risk
Personal risk
Liquidity risk
Question 3. 3. (TCO 1) Question 3. 3. (TCO 1) Which step in
the financial planning process is demonstrated by a situation in
which Royanne partially retires and travels to Europe using less
costly transportation in order to save more money for the trip?
(Points : 4)
Developing her financial goals
Identifying alternative courses of action
Evaluating her alternatives
Implementing her financial plan

2. Reviewing and revising her financial plan
Question 4. 4. (TCO 1) When you only have to pay taxes on an
investment at a future point in time, this is referred to as a(n)
(Points : 4)
cafeteria-style benefit.
vesting.
tax-deferred benefit.
tax-exempt benefit.
exclusion.
Question 5. 5. (TCO 1) Through research, Martin Jones has
learned that the housing market will begin to pick up over the
next few years, creating the need for more real estate agents.
This is an example of _____ influencing jobs in the future.
(Points : 4)
demographic trends
economic conditions
industry trends
geographic trends
educational trends
Question 6. 6. (TCO 1) For January, Bethany DeWeese had cash
inflows of $4,210 and cash outflows of $4,770, resulting in a
(Points : 4)
balanced budget.
deficit of $560.
surplus of $560.
surplus of $4,210.
deficit of $650.
Question 7. 7. (TCO 1) Sherry O'Neal is interested in opening a

3. savings account and her bank offers several types. Her main
concern is that she wants to have the ability to withdraw her
money whenever she wants. She has an interest in opening an
account that is best categorized as (Points : 4)
money management.
an opportunity cost.
a limited asset.
a liquid asset.
net worth analysis.
Question 8. 8. (TCO 1) When formulating a budget, _____
should be the very first item taken into account. (Points : 4)
variable expenses
vacation expenses
fixed expenses
unplanned living expenses
recreation expenses
Question 9. 9. (TCO 2) The _____ tax is an additional tax that
many taxpayers with high incomes and high amounts of
deductions must pay. (Points : 4)
deferred
bonus
excess
capital gains
alternative minimum
Question 10. 10. (TCO 2) Megan McMillan has just won a Mega
Millions lottery. This income would be classified as (Points : 4)
earned income.
investment income.
passive income.
other income.

4. deferred income.
Question 11. 11. (TCO 2) The Federal Deposit Insurance
Corporation insures deposits up to $250,000 per person per
financial institution. Joyce has $198,000 in an individual
account and $404,000 in a joint account with her husband, Dan.
How much of Joyce's money is not covered by FDIC insurance?
(Points : 4)
$198,000
$250,000
$602,000
$150,000
$0
Question 12. 12. (TCO 2) The most liquid type of account
would be a (Points : 4)
certificate of deposit.
checking account.
money market account.
brokerage account.
share of stock.
Question 13. 13. (TCO 3) All of the following are examples of
closed-end credit except a(n) (Points : 4)
home mortgage.
installment loan to purchase new furniture.
line of credit from your bank.
automobile loan.
single lump sum credit loan due in 90 days.
Question 14. 14. (TCO 3) If Cheryl Calvert is applying for a
bank loan and the financial institution learns that she has been

5. late in making payments on past loans, the bank is examining
which of the five Cs? (Points : 4)
Character
Capacity
Capital
Collateral
Conditions
Question 15. 15. (TCO 3) An example of a credit bureau would
be (Points : 4)
Equitron.
Transexpress.
the Better Business Bureau.
Experian.
FICO.
Question 16. 16. (TCO 3) A _____ will tend to work more with
a borrower if he or she is facing legitimate payment problems.
(Points : 4)
credit union
payday advance company
finance company
department store
commercial bank
Question 17. 17. (TCO 3) Newton Jones made a 20% down
payment of $15,000 on a new car. This is an example of _____
in order to reduce lender risk. (Points : 4)
sharing the interest rate risk with his lender
pledging valuable assets that can be seized if the loan is
not repaid
taking a larger stake in the asset he is purchasing
repaying the loan over a faster period of time
None of the above

6. Question 18. 18. (TCO 3) _____ is/are the primary reason(s)
why consumers default on their debts. (Points : 4)
Medical expenses
Defective goods and services
Excessive use of credit
Fraudulent use of credit
Consumer fraud
Question 19. 19. (TCO 5) When researching current price
information for a bond or stock investment, the most readily
available source of information for most consumers can be
found within (Points : 4)
the daily newspaper.
government publications.
corporate reports.
investor newsletters.
business periodicals.
Question 20. 20. (TCO 5) If Chris is considering an investment
in a pool that is managed by professional managers, most likely
he is interested in investing in (Points : 4)
common stock.
preferred stock.
corporate bonds.
real estate.
mutual funds.
Question 21. 21. (TCO 5) The purpose of asset allocation is to
(Points : 4)
reduce risk.
increase growth.

7. lower liquidity.
provide a high return.
increase income.
Question 22. 22. (TCO 5) _____ involves the analysis of future
earnings in order to make investment decisions. (Points : 4)
Fundamental
Technical
Efficient market
Chart
Plot
Question 23. 23. (TCO 5) A(n) _____ market is one in which
previously issued financial securities are traded among
investors. (Points : 4)
technical
fundamental
efficient
secondary
primary
Question 24. 24. (TCO 5) Last year, High-Tech Electronics
earned $1.50 per share. If the current market value for a share
of stock is $60, what is the firm's P/E ratio? (Points : 4)
0.04
1.50
40.00
44.00
60.00
Question 25. 25. (TCO 5) Dave Harris has just purchased a bond
with a face value of $1,000 that pays 6%. The purchase price of

8. the bond was $900, and the bond will mature in 5 years. What is
the yield to maturity for this bond? (Points : 4)
5.5%
6.0%
9.0%
8.4%
9.8%
Question 26. 26. (TCO 5) A characteristic of serial bonds is that
they (Points : 4)
will pay no interest payments.
will have varying issue dates.
will have a series of maturity dates.
cannot be called.
will all mature 10 years from the date of issue.
Question 27. 27. (TCO 5) What is the current yield for a $1,000
corporate bond that pays 8% and has a current market value of
$800? (Points : 4)
4.00%
8.10%
8.0%
10.00%
11.00%
Question 28. 28. (TCO 3) If Damian Clowder has researched the
price of a car online and then decides to go negotiate with a
local dealership, Damian is involved in which step of the
purchasing process? (Points : 4)
Problem identification
Information gathering
Evaluating alternatives
Determining the purchase price

9. Postpurchase activities
Question 29. 29. (TCO 1) If Bradley Smith gives a cashier a
document at a point of purchase with the expectation of
obtaining a discount, he is using a (Points : 4)
coupon.
rebate.
warranty.
receipt.
promissory note.
Question 30. 30. (TCO 3) Isabel would spend $250 per week on
groceries for her family if she did not use coupons. Her coupons
save her 10% of that amount. She puts the amount saved into
her savings account. How much will she have in her savings
account at the end of the first year? Ignore interest earnings.
(Points : 4)
$250
$300
$2,040
$13,000
$1,300
Question 31. 31. (TCO 3) When a loan is made based on the
equity value of a home and the loan provides a homeowner with
tax-free income until the home is sold (to pay back the loan),
this is called a(n) (Points : 4)
conventional mortgage.
growing equity mortgage.
second mortgage.
reverse mortgage.
adjustable-rate mortgage.

10. Question 32. 32. (TCO 4) Your home insurance provides for
replacement value for personal property losses. A microwave is
stolen. It cost $300 two years ago and has an expected life of 6
years. A comparable microwave costs $425 today. What amount
will the insurance company pay? (Points : 4)
$100
$125
$425
$325
$300
Question 33. 33. (TCO 4) If Deloris Johnson hires a
housekeeper who breaks her leg when she trips on stairs, this
loss would be covered under _____ as a part of her homeowners
insurance policy. (Points : 4)
buildings and other structures
additional living expenses
personal property
personal liability
specialized coverage
Question 34. 34. (TCO 4) Martina has a policy that includes a
$500 deductible and a coinsurance provision requiring her to
pay 10% thereafter. Her medical bills total $5,500. What
amount is she required to pay personally? (Points : 4)
$1,500
$500
$1,000
$5,000
$5,500
Question 35. 35. (TCO 4) _____ is a healthcare institution that
directly contracts with specific medical care specialists in order

11. to provide healthcare services in exchange for a fixed, prepaid
monthly premium. (Points : 4)
Blue Cross
Blue Shield
A PPO
Medicaid
An HMO
Question 36. 36. (TCO 4) If Mary Lou applies for a life
insurance policy and lies about her age, a _____ provision will
state that her benefits will be what her premium would have
bought if she had been truthful about her age. (Points : 4)
policy loan
grace period
true age
guaranteed insurability
misstatement of age
Question 37. 37. (TCO 4) If Frank has a term life insurance
policy that is _____, this means that he can obtain additional
years of protection at the end of the initial term without the
need for a medical examination. (Points : 4)
straight
renewable
convertible
decreasing
accelerated
Question 38. 38. (TCO 6) The Capitalist Mutual Fund's net asset
value is $28.25. The fund has liabilities of $3 million and
1,600,000 shares have been issued. What is the value of the
fund's portfolio? (Points : 4)
$42 million
$45.2 million
$48 million

12. $48.2 million
$3 million
Question 39. 39. (TCO 6) A mutual fund that invests in
companies with a market capitalization of less than $2 billion is
called a(n) (Points : 4)
socially responsible fund.
sector fund.
small-cap fund.
index fund.
growth fund.
Question 40. 40. (TCO 6) If a person is interested in investing
in real estate, but wants to be assured that there will be some
level of diversification, he or she will want to consider (Points :
4)
a single-family dwelling.
an apartment building.
raw land.
a second mortgage.
a real estate investment trust (REIT).
Question 41. 41. (TCO 6) Judith recently inherited several
pieces of diamond jewelry from her aunt. This jewelry is an
example of (Points : 4)
a direct investment in real estate.
an indirect investment in real estate.
an investment in precious metals.
an investment in collectibles.
an investment in gems.
Question 42. 42. (TCO 6) If Jeremiah's employer makes
nontaxable contributions to a plan in his name and his salary is

13. reduced by the same amount, Jeremiah has a (Points : 4)
money-purchase pension plan.
stock bonus plan.
profit-sharing plan.
defined benefit plan.
403(b) plan.
Question 43. 43. (TCO 6) Randall owns a condo worth
$240,000, a car valued at $25,000, and miscellaneous assets
worth $7,500. He owes $185,000 on the condo and $15,000 on
the car and has no other debts. His retirement account, in which
he is fully vested, contains $27,500 in mutual funds. He is
insured with a $500,000 term life insurance policy. What is his
net worth? (Points : 4)
$92,500
$115,000
$100,000
$592,500
$600,000
Question 44. 44. (TCO 7) Larry has been facing health issues
and is afraid that he will be unable to take care of upcoming
financial transactions as his health deteriorates. As a result, he
decides to file a(n) _____ so that his niece will be granted the
ability to act on his behalf. (Points : 4)
letter of last instruction
durable power of attorney
will
revocable trust
irrevocable trust
Question 45. 45. (TCO 7) Marion would be acting in the
capacity of a(n) _____ if she is selected to manage the assets of

14. her 16-year-old niece until the niece reaches the age of 21.
(Points : 4)
executrix
trustee
guardian
beneficiary
administrator
Number of Pages: 4 (Double Spaced)
Writing Style: APA
Number of sources: 3
Academic Monitoring in Athletics
I need to answer this question. Develop three hypothetical
research approaches for the Statement of the Problem and the
Purpose. For each approach, briefly describe how the approach
would be applied to the Purpose. Finally compare and contrast
the three approaches in terms of the advantages of each and
disadvantages of each.