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PFP Exam 1 Quizzes & Ans!!
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PFP Exam 1 Quizzes & Ans!!
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Name: Score:80 Multiple choice questions
Term 1 of 80
Long-Term Capital Gain
A gain on assets that were held for 12 months or longer. ( Ch. 4 )
Profits from assets owned for 12 months or less. ( ch. 4 )
True. ( ch. 4 )
Income earned when an asset is sold at a higher price than paid for. ( ch. 4 )
Term 2 of 80
Present Value Interest Factor ( PVIF )
The process of finding the present value of a cash flow. ( ch. 3 )
A factor multiplied by a future value to determine the present value of that amount. ( Ch. 3 )
A factor multiplied by today's savings to determine how the savings will accumulate over
time. ( Ch. 3 )
A financial statement that measures a person's cash inflows and outflows. ( ch. 2 )
Term 3 of 80
Number of years ( N )
total number of investments made. ( ch. 3 )
number of years until retirement. ( ch. 3 )
time taken to withdraw the investment. ( ch. 3 )
# of years the money will be invested. ( Ch. 3 )
,Term 4 of 80
Money grows faster as the ______________ period becomes shorter.
Inflation rate. ( ch. 3 )
Loan term. ( ch. 3 )
Compounding. ( Ch. 3 )
Interest rate. ( ch. 3 )
Term 5 of 80
Deduction of $1,000 will reduce your Taxable Income by $1,000.
True. ( Ch. 3 )
Cash flow.
True.
Decrease. ( Ch. 2 )
Definition 6 of 80
The extra taxes paid on an additional dollar of income. ( Ch. 4 )
Marginal Tax Rate
Effective Tax Rate
Average Tax Rate
State Income Tax
,Term 7 of 80
Aidan expects a signing bonus when he graduates in 3 years for the amount of $8,200. What is
that bonus worth in today's dollars if the opportunity cost on investments is 9%?
N=3
I/Y = 3
PV = -$18,500
PMT = 0
FV = $20,215
N=3
I/Y = 9
PV = -$6,331
PMT = 0
FV = $8,200
N=4
I/Y = 8
PV = -$8,820.35
PMT = 0
FV = $12,000
N=7
I/Y = 6
PV = -$23,000
PMT = 0
FV = $34,583
Term 8 of 80
This equation is showing a Tax Credit or Deduction? $1,410 + [ .12 * ($50,000 - $14,101)] = $5,718 -
$1,000 = $4,718
Tax Credit
Periodic Income
Tax Exemption
Tax Deduction
, Term 9 of 80
The balance you owe as a loan is a _____________.
Asset.
Liability.
Equity.
Revenue.
Term 10 of 80
Invested Assets
Investments. ( Ch. 2 )
Current liabilities & long-term liabilities. ( ch. 2 )
Increase. ( Ch. 2 )
Interest rate ( % ). ( ch. 3 )
Term 11 of 80
Non - Discretionary expenses...
Flexible, unnecessary expenses. ( Ch. 2 )
One-time, optional costs. ( Ch. 2 )
Occasional, luxury spending. ( Ch. 2 )
Regular, needed expenses. ( Ch. 2 )
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