Case Study: Personal Financial Planning Answers

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1
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Which is the most important consideration when deciding to purchase or lease a vehicle?

A
all current monthly expenditures
B
the amount of cash saved
C
the cost of gas and insurance
D
all monthly car payments
2
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What is the first step in the decision-making process?

A
Take action.
B
Get information.
C
Form a decision.
D
Identify the choices.
3

Which budgeting questions should Sara ask when deciding whether to rent or buy a house? Check all that apply.Do I have enough money saved for a down payment?How much can I afford to pay each month?What are the advantages of buying or renting?How many rooms does the new home have?Which real estate agent should I hire?

A
Do I have enough money saved for a down payment?
B
How much can I afford to pay each month?
C
What are the advantages of buying or renting?
D
How many rooms does the new home have?
E
Which real estate agent should I hire?
4

[BLANK]

A
net
B
gross
5

[BLANK]

A
spending
B
saving
C
paying
6

When making a decision about housing, the first step should be

A
visiting different housing locations.
B
gathering information on available housing.
C
analyzing the availability of housing loans.
D
comparing the cost of housing alternatives.
7

[BLANK]

A
budget
B
transportation
C
utilities
D
insurance
9

The chart compares transportation options.

Question illustration
A
the up-front cost
B
the monthly payments
C
the length of payments
D
the cost of insurance and gas
10

Which expense category will most likely be changed to allow money for the purchase of a car?

A
savings
B
groceries
C
utilities
D
entertainment
11

Buying a new car can create a financial challenge because

A
car insurance rates will decrease over time.
B
car payments must become part of the budget.
C
car insurance rates will be higher than renter’s insurance.
D
car payments are likely to exceed available income.
12

What is an advantage of renting a place to live?

A
lower up-front costs
B
payments change from month to month
C
low down payment
D
increasing equity over time
13

When planning a budget, the biggest consideration should be the

A
the monthly savings amount.
B
the total income available to spend.
C
the total housing or rent payments.
D
the monthly transportation cost.
14

The chart compares transportation options.

Question illustration
A
the up-front cost
B
the monthly payments
C
the length of payments
D
the cost of insurance and gas
15

Which fixed expense would be most difficult to change if money is needed for car payments?

A
rent
B
electricity
C
cable
D
Internet

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