This quiz works best with JavaScript enabled. Home > Finance > Personal Finance > Personal Financial Planning > Personal Financial Planning – Quiz 2 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Personal Financial Planning Quiz 2 (30 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. Put aside at least ..... % of your income for your savings A) 5. B) 10. C) 20. D) None of above. Show Answer Correct Answer: B) 10. 2. The total value of a person's financial assets minus their obligations (liabilities). A) Cash flow. B) Net worth. C) Gross pay. D) Net pay. Show Answer Correct Answer: B) Net worth. 3. Elijah budgeted $ 100 a month for entertainment, but this month he only spent $ 75. This is considered a ..... A) Budget surplus. B) Shortage. C) Budget variance. D) Budget deficit. Show Answer Correct Answer: C) Budget variance. 4. Long-term investment is better than short-term investment because A) Lower risk than short-term investment. B) More effort demanding than short-term investment. C) To have more money in own pocket. D) More money earned in a short time. Show Answer Correct Answer: A) Lower risk than short-term investment. 5. The total earnings paid to an employee after payroll taxes and other deductions. Also known as take-home pay. A) Net worth. B) Net pay. C) Gross pay. D) Wage. Show Answer Correct Answer: B) Net pay. 6. Spending, saving, and investing to have the kind of life that you want and financial security can be achieved by A) Paying interest. B) Regulating inflation. C) Personal financial planning. D) Buying stock. Show Answer Correct Answer: C) Personal financial planning. 7. Which of the following is not an example of a personal financial statement A) Bank Statement. B) Ledger Statment. C) Personal Budgets. D) Cashflow Statements. Show Answer Correct Answer: B) Ledger Statment. 8. Items with special qualities that make them more expensive than alternative products A) Bargains. B) Consumer wants. C) Consumer goods. D) Luxury goods. Show Answer Correct Answer: D) Luxury goods. 9. Arrange the following investment from the most risky to the least risky:(1) Saving deposits (2) Stocks (3) Term deposit (4) Bonds A) , (2), (3), (4). B) , (4), (3), (1). C) , (4), (1), (3). D) , (2), (3), (1). Show Answer Correct Answer: B) , (4), (3), (1). 10. Spending money, time or items toward future benefits for making more money is called A) Borrowing. B) Paying off. C) Investing. D) Saving. Show Answer Correct Answer: C) Investing. 11. Ben's salary is $ 3000 per month, taxes are $ 500, fixed expenses are $ 1500 and savings are $ 500. His disposable income is A) $ 1500. B) $ 3000. C) $ 2500. D) $ 500. Show Answer Correct Answer: C) $ 2500. 12. What is the first step in building a financial portfolio for yoourself A) Estimate your income and expenses. B) Determine your current financial situation. C) Decide what you want your job to be in the future. D) Create a financial excel sheet. Show Answer Correct Answer: B) Determine your current financial situation. 13. Expenses that are consistent and require payment around the same time each month A) Unanticipated income. B) Anticipated income. C) Unanticipated expenses. D) Anticipated expenses. Show Answer Correct Answer: D) Anticipated expenses. 14. Hazel needs to plan the mortgage amount she can afford. How much would she need to pay at the end of each month on a mortgage of $ 200 000 at six percent interest, calculated semi-annually and amortized over 30 years? A) $ 1190. B) $ 1211. C) $ 1199. D) $ 555. Show Answer Correct Answer: A) $ 1190. 15. Expenses that are not paid every month and cannot always be planned. A) Unanticipated expenses. B) Discretionary expenses. C) Anticipated expenses. D) Disposable expenses. Show Answer Correct Answer: A) Unanticipated expenses. 16. Periodic review of the financial plan to evaluate changing market conditions (i.e. economic conditions, taxes, interest rates etc.) A) Plan Monitoring. B) Data Gathering. C) Objective Setting. D) Financial Plan Recommendation. Show Answer Correct Answer: A) Plan Monitoring. 17. Which of the following is the negative impacts of financial crisis? A) Employee revenues affected. B) Price level of goods and services increase. C) Value of money decline. D) All of the answer above. Show Answer Correct Answer: D) All of the answer above. 18. Jeff has a $ 1000 salary and $ 100 dividend income this month. This month Jeff has rent and utilities of $ 600 and he spent $ 200 on groceries and $ 100 on clothing. What is his net cash flow this month? A) $ 1100. B) $ 200. C) $ 500. D) $ 100. Show Answer Correct Answer: B) $ 200. 19. The lowest level of business activity occurs during which of the following phases in the business cycle? A) Recovery phase. B) Recession phase. C) Contraction phase. D) Boom or expansion phase. Show Answer Correct Answer: B) Recession phase. 20. A formalized report that summarizes your current financial situation, analyzes your financial needs, and recommends future financial activities A) Financial plan. B) Balance Sheet. C) Cash Flow Statement. D) Budget. Show Answer Correct Answer: A) Financial plan. 21. Having funds to buy things that require money above what is normally allowed by a budget. Short-term financial goals are usually accomplished within a year. A) Mid-term goal. B) Short-term goal. C) Long-term goal. D) Intermediate goal. Show Answer Correct Answer: B) Short-term goal. 22. A list of all of one's personal property A) Personal property inventory. B) Bank statement. C) Budget. D) Income and expense inventory. Show Answer Correct Answer: A) Personal property inventory. 23. Lee has assets valued at $ 5, 000 and liabilities including student loan debt of $ 7, 000. What is Lee's net worth? A) $ -2, 000. B) $ -35, 000. C) $ 2, 000. D) $ 12, 000. Show Answer Correct Answer: A) $ -2, 000. 24. What is the purpose of getting a pre-approval certificate from a financial institution? A) To provide you with a guideline on how large a mortgage you can afford. B) To guarantee you a mortgage interest rate valid for 30 days. C) To guarantee funding so you can make an offer on a house. D) To guarantee you will be approved for a mortgage. Show Answer Correct Answer: A) To provide you with a guideline on how large a mortgage you can afford. 25. Approximately how much would you need to invest today, to receive $ 200 in ten years, if you received an annual interest rate of ten percent? A) $ 77. B) $ 97. C) $ 65. D) $ 87. Show Answer Correct Answer: A) $ 77. 26. Mary earns $ 3500 per month. After payroll deductions from the government, Mary takes home 85 percent of her salary. Mary wants to use a pay yourself first method and puts $ 330 into her savings account before spending anything and pays $ 200 towards her student loans. What is Mary's saving rate? A) 17.8 percent. B) 15.1 percent. C) 11.1 percent. D) 9.4 percent. Show Answer Correct Answer: C) 11.1 percent. 27. Saving money means giving up the opportunity cost to A) Spend in the present. B) Save money. C) Have money in the future. D) Apply for credit cards. Show Answer Correct Answer: A) Spend in the present. 28. Which of the following is true regarding conventional mortgages? A) They require a down payment of at least twenty-five percent. B) They receive more favourable interest rates for the buyer. C) They are a form of closed mortgage. D) They require a down payment of at least twenty percent. Show Answer Correct Answer: D) They require a down payment of at least twenty percent. 29. The correct order of the key components of a financial plan is A) Financing, insurance, budgeting, investing. B) Budgeting, insurance, financing, investing. C) Budgeting, financing, insurance, investing. D) Investing, financing, insurance, budgeting. Show Answer Correct Answer: C) Budgeting, financing, insurance, investing. 30. The ease with which an asset can be converted into cash without hurting its value. A) Solvency. B) Insolvency. C) Liquidity. D) Cash flow. Show Answer Correct Answer: C) Liquidity. ← PreviousNext →Related QuizzesPersonal Finance QuizzesFinance QuizzesPersonal Financial Planning Quiz 1Personal Financial Planning Quiz 3Personal Financial Planning Quiz 4Personal Financial Planning Quiz 5 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books