16 Questions
What is the formula for calculating net worth?
Assets - Liabilities
Which of the following best defines the 'Rule of 72' in finance?
An equation to estimate the time to double an investment at a fixed annual interest rate
What is the primary purpose of investing?
Purchasing items with the hope of increasing their value over time
How is 'gross pay' calculated?
Total earnings before deductions
What do voluntary deductions from paychecks typically include?
401 K, life insurance, charity donations
What is the percentage taken out of one's check for FICA tax?
$6
What is an example of a fixed expense?
Paying for a monthly bus pass
What is the overtime rate if a person makes $10.00 per hour and works overtime?
$15.00
What does it mean to 'pay yourself first'?
Budgeting for savings before budgeting for spending
What should a person keep in a liquid account according to the text?
3-6 months' expenses
What is an example of a CD (Certificate of Deposit) con as per the text?
Penalty for early withdrawal
What does it mean if a check is 'outstanding'?
It has not been returned to the bank for payment
What do lenders/creditors look for when examining 'character'?
Person’s reputation and willingness to pay off debt
What are the three credit bureaus responsible for maintaining credit history?
TransUnion, Equifax, Experian
What does 'cosigner' mean in the context of borrowing?
Responsible person who agrees to pay the debt if you fail to pay
What is the highest possible credit score according to the text?
850
Test your knowledge of financial planning and investment terminology with this quiz. The quiz covers concepts such as financial goals, value, principal, the rule of 72, and calculating net worth.
Make Your Own Quizzes and Flashcards
Convert your notes into interactive study material.
Get started for free
