Personal Finance Canadian Edition, 2e (Madura/Gill)
Chapter 1 Overview of a Financial Plan
1.1 True/False
1) Most Canadians are capable enough to understand and develop a personal financial
plan.
Answer: FALSE
Diff: 1 Type: TF
Categories: Benefit From Understanding Finance
Financial Type: Qualitative
Skill Type: Recall
2) The per capita debt of Canadians has multiplied by more than five times from $5470 in
1980.
Answer: TRUE
Diff: 1 Type: TF
Categories: Benefit From Understanding Finance
Financial Type: Qualitative
Skill Type: Recall
3) An important step in developing a financial plan is to record specific goals you want to
achieve.
Answer: TRUE
Diff: 1 Type: TF
Categories: Developing a Financial Plan
,Financial Type: Qualitative
Skill Type: Recall
4) The simple objective of financial planning is to make the best use of your resources to
achieve your financial goals.
Answer: TRUE
Diff: 2 Type: TF
Categories: Developing a Financial Plan
Financial Type: Qualitative
Skill Type: Recall
5) Placing exact estimates on the cost of long-term goals is necessary for a financial plan
to be successful.
Answer: FALSE
Diff: 2 Type: TF
Categories: Components of a Financial Plan
Financial Type: Qualitative
Skill Type: Recall
,6) A financial plan should include estimates of the cost of a long-term goal.
Answer: TRUE
Diff: 1 Type: TF
Categories: Components of a Financial Plan
Financial Type: Qualitative
Skill Type: Recall
7) An understanding of personal finance is necessary to judge the quality of advice that a
financial adviser may give.
Answer: TRUE
Diff: 1 Type: TF
Categories: Benefit From Understanding Finance
Financial Type: Qualitative
Skill Type: Recall
8) The Financial Planning Standards Council (FPSC) is a profit-oriented organization
created to benefit the public with regards to financial planning.
Answer: FALSE
Diff: 1 Type: TF
Categories: Benefit From Understanding Finance
Financial Type: Qualitative
Skill Type: Recall
9) An example of an opportunity cost is the cost of tuition while attending college or
university instead of the hourly rate you could earn from being employed.
Answer: TRUE
Diff: 1 Type: TF
, Categories: Components of a Financial Plan
Financial Type: Qualitative
Skill Type: Recall
10) If you do one thing, you usually give up the chance to do something else. This is
called "opportunity cost."
Answer: TRUE
Diff: 1 Type: TF
Categories: Benefit From Understanding Finance
Financial Type: Qualitative
Skill Type: Recall
11) Financial advisers are in demand because most people lack understanding or are not
interested in making their own financial decisions.
Answer: TRUE
Diff: 2 Type: TF
Categories: Developing a Financial Plan
Financial Type: Qualitative
Skill Type: Recall
12) A thorough understanding of this personal finance textbook qualifies you to become a
financial adviser.
Answer: FALSE
Diff: 2 Type: TF
Categories: Benefit From Understanding Finance
Financial Type: Qualitative
Chapter 1 Overview of a Financial Plan
1.1 True/False
1) Most Canadians are capable enough to understand and develop a personal financial
plan.
Answer: FALSE
Diff: 1 Type: TF
Categories: Benefit From Understanding Finance
Financial Type: Qualitative
Skill Type: Recall
2) The per capita debt of Canadians has multiplied by more than five times from $5470 in
1980.
Answer: TRUE
Diff: 1 Type: TF
Categories: Benefit From Understanding Finance
Financial Type: Qualitative
Skill Type: Recall
3) An important step in developing a financial plan is to record specific goals you want to
achieve.
Answer: TRUE
Diff: 1 Type: TF
Categories: Developing a Financial Plan
,Financial Type: Qualitative
Skill Type: Recall
4) The simple objective of financial planning is to make the best use of your resources to
achieve your financial goals.
Answer: TRUE
Diff: 2 Type: TF
Categories: Developing a Financial Plan
Financial Type: Qualitative
Skill Type: Recall
5) Placing exact estimates on the cost of long-term goals is necessary for a financial plan
to be successful.
Answer: FALSE
Diff: 2 Type: TF
Categories: Components of a Financial Plan
Financial Type: Qualitative
Skill Type: Recall
,6) A financial plan should include estimates of the cost of a long-term goal.
Answer: TRUE
Diff: 1 Type: TF
Categories: Components of a Financial Plan
Financial Type: Qualitative
Skill Type: Recall
7) An understanding of personal finance is necessary to judge the quality of advice that a
financial adviser may give.
Answer: TRUE
Diff: 1 Type: TF
Categories: Benefit From Understanding Finance
Financial Type: Qualitative
Skill Type: Recall
8) The Financial Planning Standards Council (FPSC) is a profit-oriented organization
created to benefit the public with regards to financial planning.
Answer: FALSE
Diff: 1 Type: TF
Categories: Benefit From Understanding Finance
Financial Type: Qualitative
Skill Type: Recall
9) An example of an opportunity cost is the cost of tuition while attending college or
university instead of the hourly rate you could earn from being employed.
Answer: TRUE
Diff: 1 Type: TF
, Categories: Components of a Financial Plan
Financial Type: Qualitative
Skill Type: Recall
10) If you do one thing, you usually give up the chance to do something else. This is
called "opportunity cost."
Answer: TRUE
Diff: 1 Type: TF
Categories: Benefit From Understanding Finance
Financial Type: Qualitative
Skill Type: Recall
11) Financial advisers are in demand because most people lack understanding or are not
interested in making their own financial decisions.
Answer: TRUE
Diff: 2 Type: TF
Categories: Developing a Financial Plan
Financial Type: Qualitative
Skill Type: Recall
12) A thorough understanding of this personal finance textbook qualifies you to become a
financial adviser.
Answer: FALSE
Diff: 2 Type: TF
Categories: Benefit From Understanding Finance
Financial Type: Qualitative
