DECA Financial Literacy Practice
Exam with verified answers passed
What is created when the U.S. Supreme Court rules that a business activity is unconstitutional?
A. Federal agency
B. Common law
C. State law
D. International law - correct answer ✔✔ B
An offer must be made by one party and accepted by the other party in order for a contract to
be
A. put in written form.
B. notarized.
C. legally binding.
D. interpreted correctly. - correct answer ✔✔ C
Which of the following is an example of involuntary debt:
A. Unsecured line of credit
B. Automobile loan
C. Fixed-rate mortgage
D. Court judgment lien - correct answer ✔✔ D
A "spoof," or a fake email that appears real, is part of what investment scam?
A. Pump and dump
B. A pyramid scheme
,C. Affinity fraud
D. Phishing - correct answer ✔✔ D
Which of the following is an example of a regulation that protects investors:
A. Brokerage firms are required to abide by equal opportunity employment laws.
B. Individuals are not allowed to purchase and sell more than five stocks per week.
C. Companies must honestly and publicly disclose their business information.
D. Newspapers and magazines are not allowed to report on stock market trends. - correct
answer ✔✔ C
When providing services to clients, financial professionals have the responsibility to supply
A. accurate information.
B. payment options.
C. credit counseling.
D. bank statements. - correct answer ✔✔ A
What should you do if a financial client reports a problem with her/his portfolio?
A. Call the client back later after s/he has calmed down.
B. Apologize and resolve the problem immediately.
C. Ask the manager to return the client's call.
D. Waive the client's fees for his/her next five transactions. - correct answer ✔✔ B
Which of the following is typically an effective method to build trusting relationships with
financial clients:
A. Contacting clients only when problems arise with their accounts
B. Using precise technical language when explaining financial products
C. Asking others in the organization to follow up after sales transactions
, D. Explaining the benefits and drawbacks of different financial products - correct answer ✔✔ D
The inputs that allow businesses to operate are called economic
A. incentives.
B. services.
C. models.
D. resources. - correct answer ✔✔ D
One of the main reasons why individuals make investments based on their future financial
needs is to
A. develop a living will.
B. avoid paying taxes.
C. set up a trust fund.
D. generate retirement income. - correct answer ✔✔ D
What economic activity examines how money payments are divided between resource owners
and producers?
A. Production
B. Consumption
C. Exchange
D. Distribution - correct answer ✔✔ D
John gets up, dresses, brushes his teeth, eats breakfast, goes to school, buys gum at the school
store, and reports to his first class. Which of these would be considered an economic activity?
A. Brushing teeth
B. Eating breakfast
C. Buying gum
Exam with verified answers passed
What is created when the U.S. Supreme Court rules that a business activity is unconstitutional?
A. Federal agency
B. Common law
C. State law
D. International law - correct answer ✔✔ B
An offer must be made by one party and accepted by the other party in order for a contract to
be
A. put in written form.
B. notarized.
C. legally binding.
D. interpreted correctly. - correct answer ✔✔ C
Which of the following is an example of involuntary debt:
A. Unsecured line of credit
B. Automobile loan
C. Fixed-rate mortgage
D. Court judgment lien - correct answer ✔✔ D
A "spoof," or a fake email that appears real, is part of what investment scam?
A. Pump and dump
B. A pyramid scheme
,C. Affinity fraud
D. Phishing - correct answer ✔✔ D
Which of the following is an example of a regulation that protects investors:
A. Brokerage firms are required to abide by equal opportunity employment laws.
B. Individuals are not allowed to purchase and sell more than five stocks per week.
C. Companies must honestly and publicly disclose their business information.
D. Newspapers and magazines are not allowed to report on stock market trends. - correct
answer ✔✔ C
When providing services to clients, financial professionals have the responsibility to supply
A. accurate information.
B. payment options.
C. credit counseling.
D. bank statements. - correct answer ✔✔ A
What should you do if a financial client reports a problem with her/his portfolio?
A. Call the client back later after s/he has calmed down.
B. Apologize and resolve the problem immediately.
C. Ask the manager to return the client's call.
D. Waive the client's fees for his/her next five transactions. - correct answer ✔✔ B
Which of the following is typically an effective method to build trusting relationships with
financial clients:
A. Contacting clients only when problems arise with their accounts
B. Using precise technical language when explaining financial products
C. Asking others in the organization to follow up after sales transactions
, D. Explaining the benefits and drawbacks of different financial products - correct answer ✔✔ D
The inputs that allow businesses to operate are called economic
A. incentives.
B. services.
C. models.
D. resources. - correct answer ✔✔ D
One of the main reasons why individuals make investments based on their future financial
needs is to
A. develop a living will.
B. avoid paying taxes.
C. set up a trust fund.
D. generate retirement income. - correct answer ✔✔ D
What economic activity examines how money payments are divided between resource owners
and producers?
A. Production
B. Consumption
C. Exchange
D. Distribution - correct answer ✔✔ D
John gets up, dresses, brushes his teeth, eats breakfast, goes to school, buys gum at the school
store, and reports to his first class. Which of these would be considered an economic activity?
A. Brushing teeth
B. Eating breakfast
C. Buying gum
