AnswersEconomics and Personal FinancePersonal Finance: Responsible Planning

Practice Test Answers

14 verified answers
1
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Which statements identify errors in Jaiden’s plan? Choose four correct answers.

A
He should wait until his last year in high school to fill out the FAFSA.
B
While in high school, he should quit all extracurricular activities so he can work more hours and save money.
C
He should start saving right away. It is never too early to start a savings account.
D
He should try different sports and clubs in middle school and early high school. Then he should pick his favorites and invest more time in them.
E
He should work hard throughout middle school and high school or it might be too difficult for him to excel later, since bad habits are hard to break.
F
He should ask all his friends and neighbors to contribute to his college fund so it will grow faster.
2
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Holly plans to attend community college next year. Her expenses are only $1,200 because her parents are paying the rest. Holly earned a $750 scholarship. How much will she need to pay from her savings?

A
$1,950
B
$750
C
$1,200
D
$450
4

The Lopez family is putting $275 monthly into a savings account for Verona’s college education. The family anticipates they will need to contribute $10,000 toward her first year of college, which is in 3 years. Which best explains whether or not the family can expect to have enough money after saving for 3 years ? Assume the savings account accrues interest

A
The family will not have enough money. They will have saved only $9,900.
B
The family will not have enough money. They will have saved only $8,250.
C
The family will likely have enough money. They will have saved $8,250 and have accumulated interest.
D
The family will likely have enough money. They will have saved $9,900 and have accumulated interest.
5

Mariana wants to research a career in veterinary medicine. Where could she find accurate and objective information? Choose three correct answers.

A
She could visit a personal blog site written by a veterinarian.
B
She could visit the online site for the US Bureau of Labor and Statistics.
C
She could visit the library and check out a book from the fiction section with a veterinarian in it.
D
She could visit the library and check out a book from the career section about veterinarians.
E
She could speak with a career counselor.
6

Which best explains the purpose of revising a financial plan after a major life event?

A
to adapt to changes in the economy
B
to stay updated on potential tax breaks
C
to ensure it aligns with new responsibilities and goals
D
to rethink investments and financial safety
7

Yuri wants to pay for his new chair using a check. What must he consider before using that method of payment?

A
Yuri must check his credit history.
B
Yuri must be sure he has enough left in his checking account for any expenses and automatic payments.
C
Yuri must check his credit card balance.
D
Yuri must know the interest rate on a furniture loan.
9

Why is including estate planning in your financial plan important when starting a new business?

A
Estate planning will cause a business to expand.
B
Estate planning will legally exempt you from taxes.
C
It allows you to avoid legal roadblocks and regulations.
D
It ensures business continuity and asset protection.
10

Which best describes the purpose of recording past income and spending in a budget?

A
to learn why having savings is important
B
to serve as the basis for future planning
C
to know the historic cost of goods
D
to learn why expenditures are likely to increase
11

Which statement best explains paying in cash to cover the costs of an education?

A
It requires the use of savings.
B
It involves completing an application.
C
It is based on need or achievement.
D
It requires repayment with interest.
12

Quincy listed his assets and liabilities. Cash Rent Stocks Jewelry Student Loan Utilities Which are Quincy’s assets? Choose three correct answers.

A
stocks
B
jewelry
C
student loan
D
rent
E
cash
13

What term is used to describe an individual's money and personal property?

A
budget
B
income
C
finances
D
assets
14

Yasmine plans to attend a four-year public university. She expects she will need to contribute $9,000 annually to her education. Which savings plan will help Yasmine save enough money to pay for one year of school, regardless of whether or not interest is earned on her savings?

A
$225 per month for 3 years
B
$600 per month for 1 year
C
$350 per month for 2 years
D
$200 per month for 4 years
15

Which statement best describes lifetime income?

A
the total salary for all the years worked
B
the total cost of college classes and vocational training divided by the total years worked
C
the total salary and retirement benefits for all the years worked
D
the total salary and value of insurance benefits for all the years worked
16

To enter this field, a worker would be required to have

A
received on-the-job training for several weeks only.
B
earned technical training from a vocational school.
C
earned a degree from a four-year college at least.
D
received on-the-job training for several months only.

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