Personal Finance Concepts, Exams of Nursing

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Wise Practice Test budget variance. - correct answer ✔✔the difference between the budgeted amount and the actual amount that you spend debt ratio - correct answer ✔✔shows the relationship between debt and net worth. debt ratio - correct answer ✔✔The lower the ratio the better off financially the person is. debt ratio - correct answer ✔✔calculated by dividing liabilities by net worth excise tax - correct answer ✔✔government imposes a tax on specific goods and services such as alcohol, cigarettes, gasoline, and airline capital gains - correct answer ✔✔are profits made from the sale of capital assets such as stocks and bonds Capital gains - correct answer ✔✔tax deferred until the asset is sold, Capital Gains Tax - correct answer ✔✔If held over one year are considered long-term capital gains and are taxed at a lower tax rate or in some cases are not taxed at all. variable expenses - correct answer ✔✔change from one period to another,examples Electricity and food expenditures get advice from your friends - correct answer ✔✔will help you the least in managing your money? Financial planning - correct answer ✔✔the process of developing and implementing a coordinated series of actions to achieve financial success. Financial planning - correct answer ✔✔need to be reviewed and adjusted to accommodate changing needs and goals. emergency fund - correct answer ✔✔Should be an important consideration when saving money liquidity - correct answer ✔✔being in cash or easily convertible to cash, How easily an asset can be converted into cash Social Security - correct answer ✔✔benefits depends on the person?s earnings over a lifetime of work Department store charge cards. - correct answer ✔✔open-end credit Department store charge cards. - correct answer ✔✔is a revolving live of credit that is offered by banks There is a limit set on the line of credit and the funds mortgage loan - correct answer ✔✔closed-end credit,made at a specified interest rate for a specified time period. collateralized loan. - correct answer ✔✔A loan that is secured by collateral, properties or assets that are subject to seizure on default. collateralized loan. - correct answer ✔✔When a person brings an item to a pawnshop to obtain cash, the transaction is considered Federal Housing Administration (FHA) loan - correct answer ✔✔insures lenders who make mortgage loans that are riskier than regular bank loans because uncollateralized loan - correct answer ✔✔A personal loan without assets to cover the loan amount. Collateral - correct answer ✔✔tangible asset that is used to secure a loan. In the case of a mortgage, the actual house or apartment serves as the collateral for that loan. cash value for whole life insurance - correct answer ✔✔Policy that accumulates cash value is more expensive than a policy that does not accumulate cash value deductible - correct answer ✔✔the amount of money that the policy holder pays when a claim is settled. deductible - correct answer ✔✔250 deductible, means the person will have to pay the first $250 which will be deducted from the claim settlement paid by the insurance company. No insurance - correct answer ✔✔First get insurance against Losses resulting from an illness, accident, or disability Liability insurance - correct answer ✔✔insurance that provides protection from claims arising from injuries or damage to other people or property Automobile insurance - correct answer ✔✔covers motor vehicles, including automobiles, trucks, and motorcycles, the injuries to the driver and passengers US Treasury Department. - correct answer ✔✔must notify be to track large deposits, the federal government requires that deposits of $10,000 or more Credit union - correct answer ✔✔Credit unions are not-for-profit savings and lending financial institutions, owned by its members direct deposits - correct answer ✔✔money is generally deposited in their checking account sooner, Directly from your paycheck Certificate of deposit - correct answer ✔✔has the most predictable income? Certificate of deposit - correct answer ✔✔Most certificates of deposit (CDs) are issued with an interest rate that is fixed at a specified rate for the entire term of the deposit. Deposit slips - correct answer ✔✔list the cash deposit separately from the check as well as the total of the deposit A person is depositing $20 in cash and a check for $50. On the checking account deposit slip, the person should - correct answer ✔✔list the cash deposit separately from the check as well as the total of the deposit. How to reduce fees paid for ATM transactions? - correct answer ✔✔When making supermarket purchases with a debit card, a person adds $50 in cash to the transaction instead of using an ATM machine. Series EE savings bond - correct answer ✔✔financial product can you buy for $25, is safe, and will be worth $50 at a future date? Savings account interest - correct answer ✔✔Is taxable Money orders are: - correct answer ✔✔A purchased certificate to pay a specified amount to a specific payee Credit unions - correct answer ✔✔Are insured by National Credit Union Administration (NCUA),up to $100,000 Monetary policy - correct answer ✔✔The Federal Reserve uses to regulate the nation's money supply? debit card - correct answer ✔✔Purchases made with your debit card are usually Deducted immediately from your checking account ATM (Automated Teller Machine) - correct answer ✔✔a computer terminal that you can use to make deposits, withdraw cash, transfer money between accounts, check your account balances, and pay some kinds of bills Money in the United States includes: - correct answer ✔✔consists of coins, paper currency, checking account balances on which checks can be drawn, savings deposits, and time deposits such as CDs and money market funds. ATM Pin number - correct answer ✔✔You should never write any PIN on something that might be stolen. Write your PIN down and keep it in a secure place in your home. Financially literate? - correct answer ✔✔They understand the basics of personal finance and money management Capital gains - correct answer ✔✔provides an increase in assets or wealth? electronic funds transfer (EFT) is: - correct answer ✔✔An ATM transaction,authorize a financial institution to debit or credit an account Identity Theft - correct answer ✔✔exposes consumers to greater likelihood of fraud and/or identity theft. stock split - correct answer ✔✔an increase in the number of outstanding shares of a corporation without changing the shareholders' equity stock split - correct answer ✔✔A division of shares of a company into a larger number of shares. A 2 for 1 _____ allows a shareholder to double the number of shares but worth one half of their previous value.2-for-1 ______on 40 shares that is worth $80 would result in 80 shares at $40 at the time treasury bill (T-bill) - correct answer ✔✔a secure, low risk investment treasury bill (T-bill) - correct answer ✔✔These bills are backed by the full faith and credit of the US government, therefore considered relatively risk free dividend reinvestment - correct answer ✔✔using dividends previously earned on the stock to buy more shares