Test bank for Personal Finance, Turning Money into Wealth 9th Edition by Arthur J. Keown All Chapters 1-17 Covered

Test bank
Personal Finance, Turning Money into Wealth
9th Edition by Arthur J. Keown
All Chapters 1-17 Covered




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,TABLE OF CONTENT l l




PART I: FINANCIAL PLANNING
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1. The Personal Financial Planning Process
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2. Measuring Your Financial Health and Making a Plan l l l l l l l


3. Understanding and Appreciating the Time Value of Money l l l l l l l


4. Tax Planning and Strategies
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PART II: MANAGING YOUR MONEY
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5. Cash or Liquid Asset Management
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6. Using Credit Cards: The Role of Open Credit
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7. Student and Consumer Loans: The Role of Planned Borrowing
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8. The Home and Automobile Decision
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PART III: PROTECTING YOURSELF WITH INSURANCE
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9. Life and Health Insurance
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10. Property and Liability Insurance l l l




PART IV: MANAGING YOUR INVESTMENTS
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11. Investment Basics l


12. Investing in Stocks l l


13. Investing in Bonds and Other Alternatives l l l l l


14. Mutual Funds and Exchange-Traded Funds: An Easy Way to Diversify
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PART V: LIFE CYCLE ISSUES
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15. Retirement Planning l


16. Estate Planning: Saving Your Heirs Money and Headaches
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17. Financial Life Events: Fitting the Pieces Together l l l l l l




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,PersonallFinance,l9thleditionlKeownlChapt
erl1-17

PersonallFinance:lTurninglMoneylIntolWealth,l9el(Keown)lC
hapterl1 ThelFinanciallPlanninglProcess

1.1 FacinglFinanciallChallenges

1) Oncelalsoundlfinanciallplanlislinlplace,ltherelshouldlbelnolneedltoleverlchangelit.lAns
wer:l FALSE
Diff:l1
Topic:l ThelFinanciallPlanninglProcesslAA
CSB:l AnalyticallThinking

2) Onelpurposeloflfinanciallplanninglisltolhelplyoullegallylreducelthelamountlofltaxeslyoulhaveltolpaylo
nlyourlearnings.
Answer:l TRUElDiff:l
1
Topic:l FinanciallPlanninglAACS
B:l AnalyticallThinking

3) Whenlcomparingltwoldifferentlinvestmentlopportunitieslthelinvestorlshouldlalwayslchooselthelin
vestmentlthatlminimizesltheltotallamountlofltaxeslpaid.
Answer:l FALSElDif
f:l2
Topic:l MinimizationloflTaxeslA
ACSB:l l AnalyticallThinking

4) Annuallpubliclschoolltuitionlandlfeeslarelthreeltimeslmorelexpensivelthanlprivatelschoolltuitionland
lfees.

Answer:l FALSElDif
f:l2
Topic:l FinanciallChallengeslAA
CSB:l AnalyticallThinking

5) Beinglfinanciallylsecurelinvolveslbalancinglwhatlyoulearnlwith
A) yourlinvestments.
B) whatlyoulspend.
C) yourlretirementlplans.
D) yourlcurrentllevellofldebt.lA
nswer:l B
Diff:l1
Topic:l FinanciallPlanninglAACS
B:l AnalyticallThinking

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, 6) Financiallplanninglmightlnotlhelplyoulearnlmore,lbutlitlcanlhelplyouluselthelmoneylyouldolearnltolach
ievelyour
A) life'slpurpose.
B) dreams.
C) financiallgoals.
D) desiredllifestyle.
Answer:l l C
Diff:l1
Topic:l FinanciallGoalslAACSB:
l AnalyticallThinking




7) Whichlstatementlisltruelaboutlmanaginglpersonallfinances?
A) Thelabilityltolmanagelfinanceslislalskilllwithlwhichlyoularelborn.
B) Personallfinancelcourseslarelcommonlylofferedlinlhighlschool.
C) Financialldifficultieslcanlbelalmajorlcauseloflmaritallproblems.
D) Personallfinanciallmanagementlislnotlalskilllworthllearning.lAn
swer:l C
Diff:l2
Topic:l FinancelCompanylAACS
B:l AnalyticallThinking

8) Inlorderlforlyourlfinanciallplanltolbelrealisticlandlattainablelitlneedsltolbelbasedluponlyour
A) budget.
B) incomellevel.
C) numberlofltaxldeductions,lexemption,lexclusions,landlcredits.
D) balancelsheet.
E) noneloflthelabove.l
Answer:l B
Diff:l2
Topic:l FinanciallPlanninglAACS
B:l AnalyticallThinking

9) Personallfinanciallplanninglcanlhelplyoulto
A) deallwithlunplannedlhealthlissues.
B) minimizelyourltaxlpaymentsltolUnclelSam.
C) minimizelyourlchancesloflpersonallbankruptcy.
D) havelenoughlmoneylforlalcomfortablelretirement.
E) allloflthelabove.l
Answer:l E
Diff:l2
Topic:l FinanciallPlanninglAACS
B:l AnalyticallThinking



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