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UGBA 135 Comprehensive Revision with combined assignment Questions and Answers
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UGBA 135 Comprehensive Revision with combinedassignment Questions and Answers
when beginning to save, build an emergency fund to cover ____ - answer- 3-6 months
of living expenses
if you think you are a victim of credit card theft, the first thing you should immediately do
is: - answer- contact your credit card issuer or its bank
what most closely represents the classroom definition of a millionaire? - answer-
someone who can live their life without depending on financial help from a government
agency
when making an extra payment on a loan, always apply it first toward: - answer-
principal
under the current credit card law, payments in excess of the minimum will be first
applied to the balance with the ____ - answer- highest rate of interest
in a partnership, the general partner: - answer- has unlimited liability
if you have $100,000 of annual earned income, your contribution to social security and
medicare combined would be: - answer- $7,650
a vendor may put a hold on your credit card account: - answer- for up to 30 days
the federal government gets most of its tax revenue from: - answer- individual income
tax
if you save $2,000 per year from age 22 to age 65 at 8% compounded annually, at age
65 you will have about: - answer- $700,000
dividing 72 by the interest rate or expected rate of return tells you how many years it will
take to: - answer- double your money
each time you receive a paycheck, your goal should be to - answer- save 15%
under current credit card law, interest rates on unpaid balances are: - answer- not
capped at all
,once a year, which of the following will supply you with one free credit report: - answer-
none of the above
the only federally mandated website for free credit reports is: - answer-
www.annualcreditreport.com
as the population of a country ages, the economic growth rate tends to: - answer-
decrease
the best time to establish credit is: - answer- when you dont need the money
a major responsibility of social security is providing benefits to: - answer- all of the
above:
-american citizens
-qualify at age 62
-legal immigrants
the FDIC insures all of the following up to $250,000 per account except: - answer-
money market funds
social security payments are paid from a large endowment fund accumulated over the
years by employer contributions - answer- false
over half of america's millionaires inherited their wealth - answer- false
being frugal means buying things at the lowest possible price - answer- false
the current maximum federal personal income tax rate is 39.6% - answer- true
an investment held for 6 months and sold for a profit is not subject to a maximum capital
gains tax of 15% - answer- false
the Alternative Minimum Tax (AMT) was designed to impose a tax on higher income
people who try to pay little or no taxes - answer- true
high income earners pay more for medicare and receive higher benefits and a lower
deductible - answer- false
the maximum federal income tax on qualified stock dividends is 20% - answer- true
IPOs are usually priced for the benefit of the buyer - answer- false
mutual funds and exchange traded funds all charge about the same fees and expenses
- answer- false
,most banks and credit union have about the same account fees and minimum balance
requirements for checking and savings accounts - answer- true
according to the Nightingale/Conant survey, 20% of the people who started working at
age 25 become financially independent by age 65 - answer- false
exchange traded funds track an index, trade like a stock but are usually actively
managed - answer- true
at the current rate, medicare will go broke long before social security - answer- true
the biggest reason Americans file for bankruptcy is losses in their 401(k) - answer- false
the first step in saving money is to put together a budget - answer- true
a credit card is a secured line of credit collateralized by either your savings account or
your checking account - answer- false
alimony is when the court orders one spouse or ex-spouse to pay child support to the
other spouse or ex-spouse to help cover the expense of raising a child - answer- false
credit card payments by mail must be postmarked by 5pm on the due date to avoid a
late payment fee - answer- false
usually a person has 3 FICO scores - answer- true
under new credit card law, overdrafts on credit cards are allowed only with your
permission, but will be subject to high fees - answer- true
prepaid cards have become very popular because of their low fees - answer- false
its best to invest in stocks with money you won't need for at least 5 years - answer- true
canceling inactive credit cards is a good way to raise your FICO score - answer- false
some credit cards charge you a fee to transfer your accounts - answer- true
bankruptcy helps to wipe out all your debts and give you a fresh new start on your credit
report - answer- false
under the new credit card law, you can withdraw cash from an ATM with your credit
card and the issuer cannot charge you a fee for the transaction without your permission
- answer- false
its OK to declare fewer exemptions on your W-4 form so that your employer withholds
more taxes from your paycheck - answer- true
, retail charge cards usually charge lower interest than credit cards - answer- false
merchants pay lower transaction fees for debit cards than credit cards - answer- true
for IRS purposes, earned income and adjustable gross income are the same - answer-
false
adjusted gross income on a 1040EZ form does not include taxable interest - answer-
false
most workers pay more in Social security and medicare taxes than they do on federal
income taxes - answer- true
a person at age 65 has about a 50% chance of living to age 85 - answer- true
a "good" dividend is one in excess of the interest rate on a 10-year treasury note -
answer- true
because most seniors are taking early retirement benefits at age 62, social security is
almost broke - answer- false
social security provides tax-free income to seniors - answer- debit card charges do not
hit your account for 3 days
increasing your credit card limit can help you increase your credit score - answer- true
if you keep a record of your contacts when your identity was stolen, you do not need to
file a police report - answer- false
the most important part of your credit report is your credit score - answer- false
the biggest reasons to start saving as soon as possible is the magical powers of
compounding - answer- true
jane, age 22, contributes $2,000 at 6% to her retirement account each year for 9 years
until she is 30 and then stops contributing. Eileen, age 31, starts to contribute $2,000
per year into a similar account at 6% for 35 years, at age 65, due to compounding,
Eileen will have the most money - answer- false
the only interest you pay on a credit card balance is your go-to-rate - answer- false
if you sell a stock for a profit and buy it back within 30 days, it is a "washsale" - answer-
false
a proprietor has limited liability - answer- false
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