LIBF unit 3 MCQs || Possible Questions Accurately Answered.
Which of the following should be a feature of an individual's financial plan? It should be:
A only an estimate of income and expenditure.
B over a fixed time period.
C realistic.
D rigid. correct answers C
Which type of expenditure would a council tax payment be classed as?
A Discretionary.
B Essential.
C Mandatory.
D Optional. correct answers C
Which of the following is the most suitable product to use when planning to save over a period
of years, to build up a deposit for a house purchase?
A Bonds.
B Cash ISA.
C Notice savings account.
D Premium bonds correct answers C
If the Bank rate starts to frequently increase, which financial product is most likely to benefit a
consumer's financial sustainability?
A Credit card.
B Fixed-rate bond.
C Fixed-rate mortgage.
D Variable-rate mortgage. correct answers C
,Payday loan lenders are restricted from charging borrowers:
A interest.
B late fees.
C more than twice what they borrowed.
D more than what they borrowed correct answers C
Carl is 19, lives at home with his parents and is studying full time for his degree. Carl is working
as a part-time delivery driver, working ten hours a week. He has recently applied for the new
style Jobseeker's Allowance but was told he was not able to claim. What could be the reason for
this? Carl:
A is not earning enough to pay tax.
B is studying full time.
C lives at home with his parents.
D works ten hours a week. correct answers B
Jakob has been off sick following a car accident and has been claiming Statutory Sick Pay (SSP).
He has been told that this will end soon. What could be a possible reason for this?
A Jakob is now too old to claim.
B SSP does not cover accidents.
C SSP is paid for a maximum of 8 weeks.
D SSP is paid for a maximum of 28 weeks correct answers D
Mark, 31, is single and has been unable to work for a year due to illness. Mark also rents a single
room within a house. Which of the following benefits could Mark be entitled to?
A Attendance Allowance and Jobseeker's Allowance.
B Attendance Allowance and Statutory Sick Pay.
C Universal Credit and Employment and Support Allowance.
D Universal Credit and Statutory Sick Pay. correct answers C
,In PESTEL analysis, changes to interest rates, inflation and exchange rates are all which type of
factor?
A Economic.
B Legal.
C Political.
D Social correct answers A
Which of the following has the government encouraged banks to help combat financial and
social exclusion?
A Basic bank accounts.
B Cash ISAs.
C Competitive credit cards.
D Low interest-rate personal loans. correct answers A
The Bank of England uses the Bank rate to control which of the following?
A Demographics.
B Government spending.
C Inflation.
D Technological advances. correct answers C
Dan and Sarah both have secure jobs and have made a financial plan to buy a house in the UK in
five years' time. The houses they like are in the region of £300,000, and they know how much
they need to save. Which of the following economic factors is most likely to affect their plans?
A Exchange rates.
B Government spending.
C Inflation.
D Unemployment rates. correct answers C
, Which type of change is an increase in home ownership in the UK an example of?
A Economic.
B Environmental.
C Political.
D Social. correct answers D
Which of the following situations is least likely to be a suitable use of an emergency savings
fund? To:
A cover the effects of a serious illness.
B cover the effects of redundancy.
C pay for a holiday.
D pay for an unexpected car repair correct answers C
Aiden has a budget variance against his planned budget for the month. Which of the following is
an external factor that could have caused this to happen?
A Decreased wages.
B Increased discretionary spending.
C Increased number of hours worked.
D Petrol prices have increased correct answers D
Isla has overspent this month against the £500 she had budgeted for discretionary spending.
However, she now unexpectedly needs to pay for new tyres on her car. Which of the following
financial products could be most suitable to help her in this situation?
A Credit card.
B Personal loan.
C Store card.
D Unit trust. correct answers A
Which of the following should be a feature of an individual's financial plan? It should be:
A only an estimate of income and expenditure.
B over a fixed time period.
C realistic.
D rigid. correct answers C
Which type of expenditure would a council tax payment be classed as?
A Discretionary.
B Essential.
C Mandatory.
D Optional. correct answers C
Which of the following is the most suitable product to use when planning to save over a period
of years, to build up a deposit for a house purchase?
A Bonds.
B Cash ISA.
C Notice savings account.
D Premium bonds correct answers C
If the Bank rate starts to frequently increase, which financial product is most likely to benefit a
consumer's financial sustainability?
A Credit card.
B Fixed-rate bond.
C Fixed-rate mortgage.
D Variable-rate mortgage. correct answers C
,Payday loan lenders are restricted from charging borrowers:
A interest.
B late fees.
C more than twice what they borrowed.
D more than what they borrowed correct answers C
Carl is 19, lives at home with his parents and is studying full time for his degree. Carl is working
as a part-time delivery driver, working ten hours a week. He has recently applied for the new
style Jobseeker's Allowance but was told he was not able to claim. What could be the reason for
this? Carl:
A is not earning enough to pay tax.
B is studying full time.
C lives at home with his parents.
D works ten hours a week. correct answers B
Jakob has been off sick following a car accident and has been claiming Statutory Sick Pay (SSP).
He has been told that this will end soon. What could be a possible reason for this?
A Jakob is now too old to claim.
B SSP does not cover accidents.
C SSP is paid for a maximum of 8 weeks.
D SSP is paid for a maximum of 28 weeks correct answers D
Mark, 31, is single and has been unable to work for a year due to illness. Mark also rents a single
room within a house. Which of the following benefits could Mark be entitled to?
A Attendance Allowance and Jobseeker's Allowance.
B Attendance Allowance and Statutory Sick Pay.
C Universal Credit and Employment and Support Allowance.
D Universal Credit and Statutory Sick Pay. correct answers C
,In PESTEL analysis, changes to interest rates, inflation and exchange rates are all which type of
factor?
A Economic.
B Legal.
C Political.
D Social correct answers A
Which of the following has the government encouraged banks to help combat financial and
social exclusion?
A Basic bank accounts.
B Cash ISAs.
C Competitive credit cards.
D Low interest-rate personal loans. correct answers A
The Bank of England uses the Bank rate to control which of the following?
A Demographics.
B Government spending.
C Inflation.
D Technological advances. correct answers C
Dan and Sarah both have secure jobs and have made a financial plan to buy a house in the UK in
five years' time. The houses they like are in the region of £300,000, and they know how much
they need to save. Which of the following economic factors is most likely to affect their plans?
A Exchange rates.
B Government spending.
C Inflation.
D Unemployment rates. correct answers C
, Which type of change is an increase in home ownership in the UK an example of?
A Economic.
B Environmental.
C Political.
D Social. correct answers D
Which of the following situations is least likely to be a suitable use of an emergency savings
fund? To:
A cover the effects of a serious illness.
B cover the effects of redundancy.
C pay for a holiday.
D pay for an unexpected car repair correct answers C
Aiden has a budget variance against his planned budget for the month. Which of the following is
an external factor that could have caused this to happen?
A Decreased wages.
B Increased discretionary spending.
C Increased number of hours worked.
D Petrol prices have increased correct answers D
Isla has overspent this month against the £500 she had budgeted for discretionary spending.
However, she now unexpectedly needs to pay for new tyres on her car. Which of the following
financial products could be most suitable to help her in this situation?
A Credit card.
B Personal loan.
C Store card.
D Unit trust. correct answers A
