Personal Finance Final Exam Study Guide Correct 100%

Which statement is correct regarding mutual life insurance companies? - ANSWER A mutual company refunds part of the premium to its policyholders. Economics is the study of using money to achieve financial goals. T or F. - ANSWER False. Which type of health insurance is notoriously a poor value? - ANSWER Dread disease. When prepping a bank reconciliation, interest earned on your checking account is added to the bank statement balance. T or F. - ANSWER False. The ability to repay (ATR)/qualified mortgage (QM) rule requires lenders to consider a borrower's financial situation before granting a mortgage. T or F. - ANSWER True. Mortgage loans, automobile loans, and installment loans for purchasing furniture or appliances are examples of? - ANSWER Closed-end credit. To avoid high fees for cash loans, a person should avoid borrowing from a? - ANSWER Pawnshop. The Federal Deposit Insurance Corporation insures deposits up to $250,000 per person per financial institution. Suzanne has $520,000 in a joint account with her husband, Ted. How much is NOT covered by FDIC insurance? - ANSWER $20,000. Because, 520,000/2= 260,000 per person, therefore 10,000 per person isn't covered. Which totals 20,000 with their joint account. Aaron Garza likes to play golf. This hobby would be an example of a(n)______ factor that influences his purchasing decision. - ANSWER Social. Too many people make the move to change housing during retirement without doing enough research. T or F. - ANSWER True. With a credit score of at least 600, a person will usually be able to obtain home financing. T or F. - ANSWER False. Estate planning includes a subject most people would rather avoid: death -your own or that of your spouse. T or F. - ANSWER True. Your contribution to a Traditional IRA is fully tax deductible regardless of your filing status and your income. T or F. - ANSWER False.