FBLA Testing UPDATED Exam Questions
and CORRECT Answers
What is another name for simple average? - CORRECT ANSWER - (B) Mean
Which of the following is NOT a step in finding the gross wage for an employee who has
worked both regular time and overtime hours? - CORRECT ANSWER - (A) Find the
employee's annual average income over the past 3 years
Which method are most companies LEAST likely to use to record the number of hours their
employees work? - CORRECT ANSWER - (D) Employees keep track of their hours worked
mentally
What is the primary reason for writing a budget? - CORRECT ANSWER - (D) To help
allocate future income
The term that describes the numerical value where the interest rate and number of interest
periods meet in a compound interest table is the..? - CORRECT ANSWER - (B) Multiplier
Which of the following services are typically available to customers with online banking? -
CORRECT ANSWER - (D) All of the above
*Transfer money between accounts
*Have bills sent electronically instead of through the mail
*Have account access 24 hours a day, 7 days a week
Which of the following best describes how compound interest works? - CORRECT
ANSWER - (B) Interest is calculated and added to the previous balance to become the new
balance
Which of the following describes how to calculate simple interest? - CORRECT ANSWER -
(D) Interest = Principal x Rate x Time
,Why do banks typically assess service charges? - CORRECT ANSWER - (A) For handling a
customer's checking account
The deposit amount after subtracting any cash received by the customer is referred to as the..? -
CORRECT ANSWER - (C) Net deposit
In a Rule of 78 loan, the majority of the interest is charged..? - CORRECT ANSWER - (A) in
the beginning of the term
Some lenders require the borrower to pledge property as security for a loan. This property is
referred to as..? - CORRECT ANSWER - (D) Collateral
Which of the following best describes how cash advance on a credit card works? - CORRECT
ANSWER - (D) All of the above
*Customers can get cash from an ATM using their credit card
*The cash is borrowed money and subject to interest changes
*Credit card companies often charge a transaction fee for the service
Which formula is used to calculate the finance charge per $100 of the amount financed? -
CORRECT ANSWER - (A) (Finance Charged/Amount Financed) x $100
How many days are considered to be in a year according to the ordinary interest method? -
CORRECT ANSWER - (C) 360
Which of the following is NOT a common method of connecting to the Internet? - CORRECT
ANSWER - (B) Through a house's electrical wiring
The principal of a mortgage loan is the..? - CORRECT ANSWER - (B) Purchase price minus
the down payment
, The rate of depreciation of a car can be calculated by..? - CORRECT ANSWER - (B)
Dividing the average annual depreciation by the original cost
Which of the following would probably NOT be considered a financial disadvantage of renting a
house of apartment? - CORRECT ANSWER - (B) Renters do not have the maintenance costs
associated with home ownership
Which is the correct formula for calculating the interest earned from a bond? - CORRECT
ANSWER - (B) Interest = Par Value x Rate x Time
Company profits are distributed to shareholders in the form of? - CORRECT ANSWER - (A)
Dividends
Which of the following is true about withdrawing funds from a traditional IRA? - CORRECT
ANSWER - (D) All of the above
*Typically you can't withdraw funds before age 59 1/2 without being penalized
*Amounts withdrawn early are subject to a 10% penalty
*Amounts withdrawn are subject to federal and state income taxes
Which of the following is a typical expense associated with owning real estate? - CORRECT
ANSWER - (D) All of the above
*Taxes
*Repairs
*Insurance
The type of coverage typically included in group health policies is..? - CORRECT ANSWER -
(D) All of the above
*Hospitalization insurance
*Surgical insurance
and CORRECT Answers
What is another name for simple average? - CORRECT ANSWER - (B) Mean
Which of the following is NOT a step in finding the gross wage for an employee who has
worked both regular time and overtime hours? - CORRECT ANSWER - (A) Find the
employee's annual average income over the past 3 years
Which method are most companies LEAST likely to use to record the number of hours their
employees work? - CORRECT ANSWER - (D) Employees keep track of their hours worked
mentally
What is the primary reason for writing a budget? - CORRECT ANSWER - (D) To help
allocate future income
The term that describes the numerical value where the interest rate and number of interest
periods meet in a compound interest table is the..? - CORRECT ANSWER - (B) Multiplier
Which of the following services are typically available to customers with online banking? -
CORRECT ANSWER - (D) All of the above
*Transfer money between accounts
*Have bills sent electronically instead of through the mail
*Have account access 24 hours a day, 7 days a week
Which of the following best describes how compound interest works? - CORRECT
ANSWER - (B) Interest is calculated and added to the previous balance to become the new
balance
Which of the following describes how to calculate simple interest? - CORRECT ANSWER -
(D) Interest = Principal x Rate x Time
,Why do banks typically assess service charges? - CORRECT ANSWER - (A) For handling a
customer's checking account
The deposit amount after subtracting any cash received by the customer is referred to as the..? -
CORRECT ANSWER - (C) Net deposit
In a Rule of 78 loan, the majority of the interest is charged..? - CORRECT ANSWER - (A) in
the beginning of the term
Some lenders require the borrower to pledge property as security for a loan. This property is
referred to as..? - CORRECT ANSWER - (D) Collateral
Which of the following best describes how cash advance on a credit card works? - CORRECT
ANSWER - (D) All of the above
*Customers can get cash from an ATM using their credit card
*The cash is borrowed money and subject to interest changes
*Credit card companies often charge a transaction fee for the service
Which formula is used to calculate the finance charge per $100 of the amount financed? -
CORRECT ANSWER - (A) (Finance Charged/Amount Financed) x $100
How many days are considered to be in a year according to the ordinary interest method? -
CORRECT ANSWER - (C) 360
Which of the following is NOT a common method of connecting to the Internet? - CORRECT
ANSWER - (B) Through a house's electrical wiring
The principal of a mortgage loan is the..? - CORRECT ANSWER - (B) Purchase price minus
the down payment
, The rate of depreciation of a car can be calculated by..? - CORRECT ANSWER - (B)
Dividing the average annual depreciation by the original cost
Which of the following would probably NOT be considered a financial disadvantage of renting a
house of apartment? - CORRECT ANSWER - (B) Renters do not have the maintenance costs
associated with home ownership
Which is the correct formula for calculating the interest earned from a bond? - CORRECT
ANSWER - (B) Interest = Par Value x Rate x Time
Company profits are distributed to shareholders in the form of? - CORRECT ANSWER - (A)
Dividends
Which of the following is true about withdrawing funds from a traditional IRA? - CORRECT
ANSWER - (D) All of the above
*Typically you can't withdraw funds before age 59 1/2 without being penalized
*Amounts withdrawn early are subject to a 10% penalty
*Amounts withdrawn are subject to federal and state income taxes
Which of the following is a typical expense associated with owning real estate? - CORRECT
ANSWER - (D) All of the above
*Taxes
*Repairs
*Insurance
The type of coverage typically included in group health policies is..? - CORRECT ANSWER -
(D) All of the above
*Hospitalization insurance
*Surgical insurance
