Test Answers on 02.10 Module Two Exam – Flashcards

What are stocks?

The rate of return being offered by banks on money market accounts is 3% and increasing. Which of the following might cause this to happen?

Calliope is in her mid-30s and wants to start saving for retirement. She wants to invest a portion of her income, but she’s wary of high-risk options. How should she best allocate her investment funds?

Why might buyers be more inclined to purchase a product if it is listed for sale at $49.99, rather than $50?

“Tax bracket” is a term associated with which type of taxation?

Johann maintains a $75,000 insurance policy on his boat. He pays $50 per month in premiums and his deductible is $2,500. If he is involved in an accident that does $2,000 worth of damage to the boat, how much will he have to pay?

Which of these is an example of indirect tax?

Assume that the blue section (D) of the chart stands for stocks and the red (A) for mutual funds. This would most likely represent the portfolio of a

Your friend’s job pays $10 per hour, and he works 40 hours per week. His tax rate is 20 percent. Assuming he works 50 weeks of the year, his yearly net income is

Which tax uses the same rate for all income levels?

Austin earns $18,000 per year. His earnings put him in the 15% tax rate. What is his tax owed?

What is likely to happen if a borrower misses a payment on a credit card account?

Making a down payment reduces the

Your friend’s job pays $5.00 per hour, and he works 20 hours per week. His tax rate is 20 percent. Assuming he works 50 weeks of the year, his yearly gross income is

Rudy is a 52-year-old freelance writer who wants a short-term, low-risk investment with low liquidity. Which of these investment vehicles should he consider?

Which of the following actions would likely raise homeowner’s insurance premiums?

If an investor possesses a portfolio heavily concentrated in bank checking accounts, a financial advisor would most likely suggest which of the following aggressive investments to diversify the portfolio?

Pieta has found that his annual budget does not balance. Which of the following could he most easily adjust first?

Rachel finds a new apartment that she loves in the center of downtown, but she ultimately decides against renting it because the $1,500 per month price tag greatly exceeds her budget. Rachel’s decision to forgo the new apartment is mainly based on

Jeanine paid an annual premium of $1,200 in total liability coverage for her car, including up to $400,000 in bodily injury coverage and $100,000 in property damage coverage. Twelve years into her policy, Jeanine caused an accident that resulted in the other driver claiming $40,000 in medical costs and $15,000 in car damage. Jeanine’s insurance company paid the claim.

Which type of credit involves a set limit based on what a consumer pays up front?

What will happen if Jonathan is habitually late on loan payments?

Kendra wants to become a computer technician, but she has a great deal of debt. She makes a yearly budget and finds that her projected income and expenses do not balance. What should she do to immediately correct this imbalance?

Laurent saves money from his lawn service to buy a new $20,000 mower and trailer. He would like to buy the new equipment as soon as possible but only has $12,000 in his simple interest savings account. To reach his goal sooner, Laurent should

Your friend’s job pays $5.00 per hour, and he works 20 hours per week. His tax rate is 20 percent. Assuming he works 50 weeks of the year, his yearly gross income is