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1

,TEST BANK FOR dt dt




Introduction to Personal Finance Beginning Your Financial Journey, 3rd Edition John E. Grable, Lance
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Palmer
Chapter 1-10 dt




Chapter 1 dt Beginning Your Financial Journey: The Interior Finance Point of View
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1) Which of the following refers to one's ability to understand and use personal finance in
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formation?
A) Financial risk tolerance. dt dt



B) Financial well-being. dt



C) Financial knowledge. dt



D) Financial ability. dt d



Answer: C
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Explanation: Financial knowledge is the ability to understand personal finance information. Knowin
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g who you are, where you want to go, and what skills you currently possess are essential factors shaping
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your financial journey.
dt dt dt



Diff: 1 dt



LO: 1.1, Section 1.1
d t dt dt dt



Bloom: K d t



AACSB / IMA: none; none dt dt d t dt dt



AICPA: FC: none d t dt



Min: 1 d t d t




2) People who believe that what happens to them is based on fate or luck might view their financial jour
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ney as being uncertain. This is an example of
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A) financial risk tolerance. dt dt



B) financial literacy. dt



C) feelings of control. dt dt



D) financial ability. dt d



Answer: C
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Explanation: Feelings of control is the amount of control you feel you have when making financi
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al decisions. People who believe that what happens to them is based on luck or fate might view their
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financial journey as uncertain. dt dt dt



Diff: 1 dt



LO: 1.1, Section 1.1
d t dt dt dt



Bloom: C d t



AACSB / IMA: none; none dt dt d t dt dt



AICPA: FC: none d t dt



Min: 1 d t d t




2

,3) Internal finance includes your dt dt dt



A) financial knowledge. dt



B) financial risk tolerance. dt dt



C) feelings of control. dt dt



D) All of these answer choices are correct.
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Answer: D d t



Explanation: Internal finance is essentially the combination of financial knowledge, financial risk
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tolerance, and feelings of control.
t dt dt dt dt



Diff: 1 dt



LO: 1.1, Section 1.1
d t dt dt dt



Bloom: K d t



AACSB / IMA: none; none dt dt d t dt dt



AICPA: FC: none d t dt



Min: 1 d t d t




4) Which of the following refers to your confidence and peace of mind regarding your financial sit
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uation?
A) Financial literacy. dt



B) Financial well-being. dt



C) Financial knowledge. dt



D) Financial ability. dt d



Answer: B
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Explanation: Financial well- d t dt



being is your confidence and peace of mind regarding your financial situation. Your financial well-
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being will increase as you apply your financial knowledge, develop skills, and organize your financ
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es to achieve your personal goals.
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Diff: 2 dt



LO: 1.1, Section 1.1
d t dt dt dt



Bloom: C d t



AACSB / IMA: none; none dt dt d t dt dt



AICPA: FC: none d t dt



Min: 1 d t d t




5) In addition to financial knowledge, which of the following is important in shaping your view of the
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financial world?
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A) Financial risk tolerance, only. dt dt dt



B) Feelings of control, only. dt dt dt



C) Financial well-being only. dt dt



D) Financial risk tolerance and feelings of control. dt dt dt dt dt dt dt



Answer: D d t



Explanation: Our financial decisions can be based on a biased view of the financial world, which is
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based on the combination of our financial knowledge, financial risk tolerance, and feelings of cont
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rol.
Diff: 2 dt



LO: 1.1, Section 1.1
d t dt dt dt



Bloom: C d t



AACSB / IMA: none; none dt dt d t dt dt



AICPA: FC: none d t dt




3

, Min: 1
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4