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Introduction to Personal Financial Planning Chapter Exam

Exam Instructions:

Choose your answers to the questions and click 'Next' to see the next set of questions. You can skip questions if you would like and come back to them later with the yellow "Go To First Skipped Question" button. When you have completed the practice exam, a green submit button will appear. Click it to see your results. Good luck!

Page 1

Question 1 1. Assume that you have two hours to spend at the mall. You can either visit the bookstore or enjoy a movie at the theater. The opportunity cost of watching a movie is equivalent to which of the following?

Question 2 2. Why is it important to start saving money early in life?

Question 3 3. Which of the following is NOT a factor banks take into account when deciding to give you credit?

Question 4 4. Which type of banking institution is nonprofit and caters to specific groups of people who become members of the institution?

Question 5 5. Which of the following statements about credit is TRUE?

Page 2

Question 6 6. You are overseeing the construction of buildings on an island. Why would you want to build high-rises?

Question 7 7. It takes Joan 1 hour to make a pizza and 2 hours to make a cake. Joan's opportunity cost of making a pizza is which of the following?

Question 8 8. What is the difference between gross income and net income?

Question 9 9. Which of the following allows us to cope with scarcity of resources?

Question 10 10. A bond is _____.

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Question 11 11. _____ is the study of business and consumers, while _____ is the study of the economy as a whole.

Question 12 12. _____ refers to planning your future income and expenses to ensure they balance.

Question 13 13. As Rosa considers where to build her new bakery, she also factors in the number of other bake shops in the area. If she builds in an area where she is one of many bakeries, she will be forced to charge lower prices in order to compete with the other bakeries already in the neighborhood. This is an example of which economic theory?

Question 14 14. What is the present value of a series of $50,000 payments for 10 years at an interest rate of 5% per year?

Question 15 15. During the time Mary spent studying macroeconomics, she could have instead either made brownies or played the piano. She thinks to herself that if she wasn't studying, then she would have made brownies. In this case, her opportunity cost of studying is equal to which of the following?

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Question 16 16. The time value of money teaches us that

Question 17 17. Assuming there are only two countries, Country A can produce 10 tons of wheat or 20 tons of rice, while Country B can produce 5 tons of wheat or 15 tons of rice. Which country has the highest opportunity cost for producing 1 ton of rice?

Question 18 18. Tom is saving for a down payment on a new automobile. If he wants his savings account (which is earning a 5% interest rate) to be worth $5,000 in 3 years, how much money will he need to invest today?

Question 19 19. Which of the following is NOT a subject in the study in macroeconomics?

Question 20 20. Mary wants to have a level of ownership in her financial institution. Likewise, she wants it to help her local community. What type of institution is best for Mary?

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Question 21 21. Samantha just celebrated her first holy communion. Her parents opened a savings account (that earns 3% interest) for her to deposit the money that was gifted to her on this special occasion. Samantha deposits the $400 from her party. What will that amount will be worth in exactly 1 year from now?

Question 22 22. Which of the following gives an example of utility changing depending on the circumstances?

Question 23 23. Why might a business choose an investment bank over the other forms of banks?

Question 24 24. Which of the following best describes opportunity cost?

Question 25 25. What is economics?

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Question 26 26. Which of the following statements correctly describes the relationship between existing bond prices and market interest rates?

Question 27 27. Which of the following BEST explains sustainable economic growth?

Question 28 28. Which one of the following is an activity in which a savings and loan association engages?

Question 29 29. Which of the following people has the highest opportunity cost of earning a college degree, if they must give up their present job?

Question 30 30. You have an economics test tomorrow that you would like to pass. Which of the following activities has the greatest utility?

Introduction to Personal Financial Planning Chapter Exam Instructions

Choose your answers to the questions and click 'Next' to see the next set of questions. You can skip questions if you would like and come back to them later with the yellow "Go To First Skipped Question" button. When you have completed the practice exam, a green submit button will appear. Click it to see your results. Good luck!

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