FULL TEST BANK For Introduction to Personal Finance: Beginning Your Financial Journey 2nd Edition by John E. Grable Latest Update Graded A+

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,TEST BANK FOR r r



Introduction to Personal Finance Beginning Your Financial Journey, 2nd Edition John
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E. Grable, Lance Palmer
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Chapter 1-10 r




Chapter 1 r 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
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finance information?
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A) Financial risk tolerance. r r


B) Financial well-being. r


C) Financial knowledge. r


D) Financialability.
Answer: C
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Explanation: Financial knowledge is the ability to understand personal finance information. r r r r r r r r r


Knowing who you are, where you want to go, and what skills you currently possess are essential
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factors shaping your financial journey.
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Diff: 1 r


LO: 1.1, Section r


1.1 Bloom: K
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AACSB / IMA: none;
r r r


none AICPA: FC: none
r r


Min: 1
r




2) Peoplewhobelievethat what happens to them isbased on fateorluck might viewtheir financial
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journey as being uncertain. This is an example of
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A) financial risk tolerance. r r


B) financial literacy. r


C) feelings of control. r r


D) financialability.
Answer: C
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Explanation: Feelings of control is the amount of control you feel you have when making r r r r r r r r r r r r r


financial decisions. People who believe that what happens to them is based on luck or fate
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might view their financial journey as uncertain.
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Diff: 1 r


LO: 1.1, Section r


1.1 Bloom: C
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AACSB / IMA: none;
r r r


none AICPA: FC: none
r r


Min: 1
r




2

,3) Internal finance includes your r r r


A) financial knowledge. r


B) financial risk tolerance. r r


C) feelings of control. r r


D) All of the choices are correct.
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Answer: D
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Explanation: Internal finance is essentially the combination of financial knowledge, financial r r r r r r r r r


risk tolerance, and feelings of control.
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Diff: 1 r


LO: 1.1, Section r


1.1 Bloom: K
AACSB / IMA: none;
r r r


none AICPA: FC: none
r r


Min: 1
r




4) Which of the following refers to your confidence and peace of mind regarding your
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financial situation?
r r


A) Financial literacy. r


B) Financial well-being. r


C) Financial knowledge. r


D) Financialability.
Answer: B
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Explanation: Financial well-being is your confidence and peace of mind regarding your financial
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situation. Your financial well-being will increase as you apply your financial knowledge, develop
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skills, and organize your finances to achieve your personal goals.
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Diff: 2 r


LO: 1.1, Section 1.1
r r r


Bloom:
r C r r


AACSB / IMA: none; r r


none AICPA: FC: none
r r r


Min: 1
r




5) In addition to financial knowledge, which of the following is important in shaping your view of the
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financial world?
r r


A) Financial risk tolerance, only. r r r


B) Feelings of control, only. r r r


C) Financial well-being only. r r


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


Answer: D
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Explanation: Our financial decisions can be based on a biased view of the financial world, r r r r r r r r r r r r r


which is based on the combination of our financial knowledge, financial risk tolerance, and
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feelings of control.
r r r


Diff: 2 r


LO: 1.1, Section r


1.1 Bloom: C
AACSB / IMA: none;
r r r


none AICPA: FC: none
r r


Min: 1
r




3

, 6) Which of the following refers to your willingness to engage in financial endeavors that
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have uncertain outcomes?
r r r


A) Financial literacy. r


B) Financial risk tolerance. r r


C) Financial knowledge. r


D) Financialability.
Answer: B
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Explanation: Your financial risk tolerance is your willingness to engage in financial r r r r r r r r r r


endeavors that have uncertain outcomes.
r r r r r


Diff: 1 r


LO: 1.1, Section r


1.1 Bloom: K
AACSB / IMA: none;
r r r


none AICPA: FC: none
r r


Min: 1
r




7) Which of the following is measured by adding up how much the United States produces in
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goods and services in a year?
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A) Gross domestic product. r r


B) The cost of goods sold.
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C) Financial literacy. r


D) Financialrisktolerance.
Answer: A
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Explanation: Gross domestic product (GDP) is measured by adding up how much a country r r r r r r r r r r r r


produces in goods and services in a year.
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Diff: 1 r


LO: 1.1, Section r


1.1 Bloom: K
AACSB / IMA: none;
r r r


none AICPA: FC: none
r r


Min: 1
r




8) How much of GDP consists of consumer spending?
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A) 46%.
B) 50%.
C) 60%.
D) 66%.
Answer: D
Explanation: In 2020, the U.S. GDP was $19.80 trillion and nearly two-thirds (66%) of GDP
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consists of consumer spending.
r r r r


Diff: 1 r


LO: 1.1, Section r


1.1 Bloom: K
AACSB / IMA: none;
r r r


none AICPA: FC: none
r r


Min: 1
r




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