AnswersPersonal Finance - EL3403Principles of Financial Planning

Principles of Financial Planning — Unit test Answers

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1
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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 know the interest rate on a furniture loan.
C
Yuri must be sure he has enough left in his checking account for any expenses and automatic payments.
D
Yuri must check his credit card balance.
2
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Yarin’s gross pay for the year was $3,500. The federal income tax withholding from his pay was 9% of his gross pay. Yarin determined the federal income tax he owes is $115. How much of a refund can Yarin expect?

$
$200
$
$315
$
$3,035
$
$3,185
3

Iliana’s gross pay is $2,130 per month. Her deductions total $270. She budgets for $1,000 in fixed expenses and $400 in variable expenses. How much money will Iliana be able to save?

A
$270
B
$460
C
$730
D
$860
4

The Dumescu family made a chart to compare its budget items. Liliana noticed that the sum of three of the budget items was half of the budget. Which three items was she referring to?

Question illustration
A
housing, clothing, and savings
B
housing, medical, and food
C
food, transportation, and clothing
D
transportation, savings, and housing
5

A refrigerator is priced at $1,250. There are two options offered to reduce the price: either a 25% discount off the price or a rebate of $300. Which is the better choice, and what is the extra amount saved?

T
The 25% discount is better; it saves $12.50 more.
T
The rebate is better; it saves $12.50 more.
T
The 25% discount is better; it saves $75 more.
T
The rebate is better; it saves $75 more.
6

What is one cost of avoiding insurance?

A
falling into debt if faced with a serious problem
B
not benefitting from insurance deductibles
C
not being able to purchase a car or home
D
facing increased probability of accidents
7

What are possible advantages and disadvantages of using automatic withdrawal to pay bills? Check all that apply.

A
not having to keep track of the balance in a checking account
B
avoiding late payment fees
C
having to share your account information
D
not having to find a stamp and a mailbox
E
not knowing when the payment will be taken out of your account
F
possible overdraft fees if there is not enough money in the account to cover the payment amount
G
having to pay a fee for the service
8

In some cases, it is safe to avoid insurance because

i
it is too expensive.
i
it may not be needed.
o
only one person is at risk.
o
one is already in debt.
9

What does purchasing insurance for a business reveal about the business owner’s attitude toward financial risk?

A
It shows that the owner expects financial risk and is eliminating it by making an insurance company liable.
B
It shows that the owner acknowledges the financial risks and is willing to pay every month to transfer the risk to an insurance company.
C
It shows that the owner is willing to share ownership of the business to reduce financial risk.
D
It shows that the owner is willing to budget for short-term financial risks to avoid long-term risks.
10

Melanie is very concerned with avoiding late fees. The table shows her choices for paying her bills. MethodBill Payment Methods1Pay by check2Pay online3Set up automatic payments4Pay by telephoneWhich method should she use to pay her bills? Enter the response using the corresponding method number.

Answer not available

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