Wise Test Study Guide Question and answers rated A+ 2024/2025
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Wise Test Study Guide Question and answers rated A+ 2024/2025 wise test review #1
a person has three credit cards with large outstanding balance and is unable to make payments on any of them. what action should the person take? - correct answer notify the credit card companies in order to neg...
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Wise Test Study Guide
What are the sources of income? - correct answer ✔wages, rentals, interest,
capital, profits, investments, entrepreneurship
What is exemption (allowance) and how does it work? - correct answer
✔allowance is used to reduce amount of taxed income
What are Gift Cards and how do they work? - correct answer ✔they are a
closed loop system and open loop system
What is a money order? - correct answer ✔it is a payment order for a pre-
specified amount of money and is purchased at different types of stores -- it is
used as a check.
Why does the U.S. currency have value even though it is not tied to a
commodity? - correct answer ✔there is a belief that money has value and
therefore is accepted.
what is opportunity cost? - correct answer ✔the next best alternative -- it is
what is given up when a choice is made.
who is hurt the most and the least with inflation? - correct answer ✔most hurt
are lenders (banks) and people living on a fixed income. Least hurt are those
who owe large amounts of money.
What is the role of the Treasury Department? - correct answer ✔collects
taxes, prints money, issues treasury bonds
, What does it mean when you Pay-Yourself-First? - correct answer
✔automatically route money from paycheck to savings (before paying bills)
What is a CD and what happens if you cash it before maturity? - correct
answer ✔it is a time deposit offered at financial institutions -- penalty if
cashed before maturity.
Which institutions give loans? - correct answer ✔banks, credit unions,
pawnshops, finance companies, payday lenders, tax preparers
which institution(s) charge the highest interest rates on loans? - correct
answer ✔pawnshops, payday lenders, tax refund lenders, finance companies
what is a credit union and the advantage of using a credit union? - correct
answer ✔member owned co-operative financial institution -- advantage is
lower interest rates on loans
what is overdraft protection and how does it work? - correct answer
✔overdraft protection is a feature offered by banks to keep your checking
account from over-drafting when you write a check or swipe your debit card
but don't have enough money in your account. It is a loan that is paid back.
what is compound interest? - correct answer ✔interest added to principal --
interest earned on interest
what is the time value of money? - correct answer ✔is calculated by value of
money with given amount of interest earned over a period of time; the longer
the time you keep your money invested, the more interest you will earn.
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