WISE Financial Literacy Test Questions and
Answers | Latest Test Bank with Verified
Solutions | A+ Pass Guaranteed
• liquidity -✓✓The ability to convert an asset to cash quickly and with minimal impact to
the price
• liquidity examples -✓✓cash, most stocks, money market instruments and government
bonds
• money market accounts -✓✓it is the organized exchange on which participants can
lend and borrow large sums of money for a period of one year or less
• bonds -✓✓it is the organized exchange on which participants can lend and borrow
large sums of money for a period of one year or less
• Gift cards -✓✓A gift card is a restricted monetary equivalent is issued by retailers or
banks to be used as an alternative to a non-monetary gift.
• Discretionary income and budget surplus -✓✓The amount of an individual's income
that is left for spending, investing or saving after taxes and personal necessities (such
as food, shelter, and clothing) have been paid. Discretionary income includes money
spent on luxury items, vacations and non-essential goods and services.
• money orders -✓✓A certificate that allows the stated payee to receive cash
on-demand, usually issued by governments and banking institutions. A money order
functions much like a check, in that the person who purchased the money order may
stop payment.
• why does the US currency have value -✓✓Its value is only based on what we can get
in exchange for it. Or put it another way, money has value as long as other people
believe the money you give them can be
exchanged for the goods and services they desire in the
future.
• opportunity cost -✓✓the value of the best alternative that must be given up when
scarce resources are used for one purpose instead of another
• inflation -✓✓a general increase in prices and a corresponding decrease in money's
purchasing power
• Consumer Price Index (CPI) -✓✓a measure of the overall cost of the goods and
services bought by a typical consumer
, • Inflation -✓✓An increase in the overall price level.
• Who gets hurt the most from inflation -✓✓Those with fixed incomes (retired people)
• who gets hurt the least from inflation -✓✓borrowers and producers
• Treasury department -✓✓responsible for issuing all treasury bonds, notes, and bills.
• Pay yourself first -✓✓Put money into savings each month as if it were a bill. At least
10% of your income should go into savings. It's
recommended you have 6-8 months of expenses saved.
• Certificate of Deposit -✓✓Low risk (and low return) investments suitable for cash you
don't need for months or years. (safest type of investment)
• traditional CD (certificate of deposit) -✓✓you receive a fixed interest rate over a
specific period of time. When that term ends, you can withdraw your money or roll it into
another CD.
• Liquid CD (certificate of deposit) -✓✓this kind of account allows you to withdraw part of
your deposit without paying a penalty. The interest rate on this CD usually is a little
lower than others, but the rate is still higher than the rate in a money market account.
• Zero-coupon CD (certificate of deposit) -✓✓This kind of CD does not pay out annual
interest, and instead re-invests the payments so you earn interest on a higher total
deposit. The interest rate offered is slightly higher than other CDs, but you'll owe taxes
on the re-invested interest.
• Pawnshops -✓✓A short term loan in exchange for leaving a personal item, such as
jewelry, or an electric device, as a collateral.
• Payday lenders -✓✓Allows you to borrow against your future income.
• Banks vs Credit unions -✓✓1-Credit Unions are nonprofit institutions while banks are
profit oriented institutions.
2-Credit Unions has members who deposit money and share ownership, while banks
has members with no ownership.
3- Credit Unions are controlled democratically by its members, but banks are controlled
by stockholders and paid officials.
• tax preparers -✓✓short-term consumer loans, usually 24-48 hours, secured by a
taxpayer's expected tax refund, and designed to offer customers quicker access to
funds
Answers | Latest Test Bank with Verified
Solutions | A+ Pass Guaranteed
• liquidity -✓✓The ability to convert an asset to cash quickly and with minimal impact to
the price
• liquidity examples -✓✓cash, most stocks, money market instruments and government
bonds
• money market accounts -✓✓it is the organized exchange on which participants can
lend and borrow large sums of money for a period of one year or less
• bonds -✓✓it is the organized exchange on which participants can lend and borrow
large sums of money for a period of one year or less
• Gift cards -✓✓A gift card is a restricted monetary equivalent is issued by retailers or
banks to be used as an alternative to a non-monetary gift.
• Discretionary income and budget surplus -✓✓The amount of an individual's income
that is left for spending, investing or saving after taxes and personal necessities (such
as food, shelter, and clothing) have been paid. Discretionary income includes money
spent on luxury items, vacations and non-essential goods and services.
• money orders -✓✓A certificate that allows the stated payee to receive cash
on-demand, usually issued by governments and banking institutions. A money order
functions much like a check, in that the person who purchased the money order may
stop payment.
• why does the US currency have value -✓✓Its value is only based on what we can get
in exchange for it. Or put it another way, money has value as long as other people
believe the money you give them can be
exchanged for the goods and services they desire in the
future.
• opportunity cost -✓✓the value of the best alternative that must be given up when
scarce resources are used for one purpose instead of another
• inflation -✓✓a general increase in prices and a corresponding decrease in money's
purchasing power
• Consumer Price Index (CPI) -✓✓a measure of the overall cost of the goods and
services bought by a typical consumer
, • Inflation -✓✓An increase in the overall price level.
• Who gets hurt the most from inflation -✓✓Those with fixed incomes (retired people)
• who gets hurt the least from inflation -✓✓borrowers and producers
• Treasury department -✓✓responsible for issuing all treasury bonds, notes, and bills.
• Pay yourself first -✓✓Put money into savings each month as if it were a bill. At least
10% of your income should go into savings. It's
recommended you have 6-8 months of expenses saved.
• Certificate of Deposit -✓✓Low risk (and low return) investments suitable for cash you
don't need for months or years. (safest type of investment)
• traditional CD (certificate of deposit) -✓✓you receive a fixed interest rate over a
specific period of time. When that term ends, you can withdraw your money or roll it into
another CD.
• Liquid CD (certificate of deposit) -✓✓this kind of account allows you to withdraw part of
your deposit without paying a penalty. The interest rate on this CD usually is a little
lower than others, but the rate is still higher than the rate in a money market account.
• Zero-coupon CD (certificate of deposit) -✓✓This kind of CD does not pay out annual
interest, and instead re-invests the payments so you earn interest on a higher total
deposit. The interest rate offered is slightly higher than other CDs, but you'll owe taxes
on the re-invested interest.
• Pawnshops -✓✓A short term loan in exchange for leaving a personal item, such as
jewelry, or an electric device, as a collateral.
• Payday lenders -✓✓Allows you to borrow against your future income.
• Banks vs Credit unions -✓✓1-Credit Unions are nonprofit institutions while banks are
profit oriented institutions.
2-Credit Unions has members who deposit money and share ownership, while banks
has members with no ownership.
3- Credit Unions are controlled democratically by its members, but banks are controlled
by stockholders and paid officials.
• tax preparers -✓✓short-term consumer loans, usually 24-48 hours, secured by a
taxpayer's expected tax refund, and designed to offer customers quicker access to
funds
