Question 1

Dave has quite a bit of money in the stock market.He finds that it is best to buy stock when everyone else is selling.Dave practices a __________ approach to investing.

Accepted Answer

The answer of Dave has quite a bit of money...

Question 2

The lifetime income of families headed by individuals with a bachelor's degree is:
A) Less than $550,000
B) Close to $1 million
C) $1.667 million
D) $10 million

Accepted Answer

The lifetime income of families headed by individuals with a bachelor's degree is estimated to be around $1.667 million. This figure is based on various studies that calculate the total earnings over a working lifetime, taking into account factors such as higher average salaries for degree holders compared to those without a degree.

Question 3

Which of the following is a step to controlling your assets?
A) Take an inventory of your financial assets
B) Keep track of all of your expenses
C) Start a savings plan
D) All of the responses are correct

Accepted Answer

All of the responses are correct steps to controlling your assets. Taking an inventory of your financial assets will help you understand what you have and how much you have. Keeping track of all your expenses will help you understand your spending habits and how much you are spending. Starting a savings plan will help you save money for future expenses and build wealth.

Question 4

An ARM mortgage has an interest rate that changes,thus the payment throughout the life of the loan will change.

Accepted Answer

An ARM mortgage, or adjustable rate mortgage, typically has an initial fixed interest rate for a certain period of time (such as 5, 7, or 10 years), after which the interest rate can change periodically based on market conditions. This means that the payment amount will likely change over the life of the loan.

Question 5

__________ insurance is pure insurance protection with no savings feature for a given number of years that typically costs less the younger you buy it.

Accepted Answer

The answer of __________ insurance is pure insurance protection with...

Question 6

A co-payment is an amount paid when medical services are rendered.

Accepted Answer

A co-payment is a payment made by a patient at the time a medical service is provided. The payment is typically a fixed amount or percentage of the total cost.

Question 7

Expensive jewelry and musical instruments are often not covered under basic homeowner's insurance.Instead to cover these things you must buy a __________.

Accepted Answer

The answer of Expensive jewelry and musical instruments are often...

Question 8

__________ is the common name for the Old-Age,Survivors and Disability Insurance Program established in 1935.

Accepted Answer

The answer of __________ is the common name for the...

Question 9

Which of the following statements about borrowing money is correct?
A) Borrow money for ordinary expenses such as food if you are out of cash just before the next payday
B) Save about six months of earnings for contingency purposes
C) Borrowing for things you want makes sense
D) All of the responses are correct

Accepted Answer

Saving about six months' worth of earnings for contingency purposes is the best choice. This ensures that you have enough funds to cover unexpected expenses or a temporary loss of income without having to rely on borrowing money. Borrowing money for ordinary expenses or things you want can lead to high levels of debt and financial instability.

Question 10

An individual retirement account (IRA)allows a person to save a percentage of income,tax free.

Accepted Answer

An individual retirement account (IRA) does allow a person to save a percentage of income, tax free. However, there are certain limits and rules regarding contributions and withdrawals.

Question 11

Less than __________ percent of the U.S.population has accumulated enough money by retirement age to live comfortably.
A) 10
B) 5
C) 2
D) 1

Accepted Answer

According to a study by the National Institute on Retirement Security, only about 10 percent of the U.S. population has accumulated enough money by retirement age to live comfortably.

Question 12

The value of an investment at some future point in time is called its __________.

Accepted Answer

The answer of The value of an investment at some...

Question 13

A Roth IRA is an investment that does not get up-front deductions on taxes,but the earnings grow tax-free and are tax-free when they are withdrawn.

Accepted Answer

A Roth IRA is funded with after-tax dollars, meaning there are no up-front deductions on taxes. However, the earnings on a Roth IRA grow tax-free and the withdrawals are also tax-free as long as certain conditions are met.

Question 14

__________ insurance means that if you hit someone else with your car,your insurance would pay to repair the damage on the other vehicle,but not your vehicle.

Accepted Answer

The answer of __________ insurance means that if you hit...

Question 15

__________ is a written contract between the party being insured and the insurer where the financial responsibility for losses transfers to the insurer up to a specified limit.

Accepted Answer

The answer of __________ is a written contract between the...

Question 16

When homeowner's or renter's insurance is purchased it is important to stipulate that you want guaranteed replacement cost,which will replace items,not give the depreciated value of them.

Accepted Answer

Guaranteed replacement cost will replace items without taking their depreciation value into account.

Question 17

A universal life policy is a permanent insurance plan that allows flexibility in your insurance and savings amounts.

Accepted Answer

Universal life policies allow policyholders to adjust their premiums and death benefits, which gives them more flexibility compared to other permanent life insurance options. Additionally, a portion of the premiums paid into the policy may be allocated toward a savings component, which can accumulate cash value over time.

Question 18

A(n)__________ is a contract to make regular payments to a person for life or for a fixed period.

Accepted Answer

The answer of A(n)__________ is a contract to make regular...

Question 19

Once people buy a home,the payments are relatively fixed.

Accepted Answer

Most homebuyers have fixed-rate mortgages, meaning their monthly payments remain constant over the loan term. However, property taxes and insurance costs can vary.

Question 20

Mortgage payments shouldn't amount to more than 28% of your net income.

Accepted Answer

It is a commonly recommended guideline that your mortgage payments should not exceed 28% of your net income to ensure that you do not become house poor and are able to afford other necessary expenses.

Quiz 13: Using Technology to Manage Information Lf-Test Scoring Guidelines