Personal Finance Canadian Canadian

6th Edition Kapoor Test Bank

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02
Student: _______________________________________________________________________________________

1.  Opportunity cost refers to: 

A.  current spending habits.
B.  changing economic conditions that affect a person's cost of living.
C.  storage facilities to make financial documents easily available.
D.  trade­offs associated with financial decisions.
E.  avoiding the use of consumer credit.

2.  A home file should be used for: 

A.  storing all financial documents and records.
B.  obsolete financial documents.
C.  documents that require maximum security.
D.  financial records for current needs.
E.  records that are difficult to replace.

3.  Which of the following financial documents would most likely be stored in a safety deposit box? 

A.  FT­4 slips
B.  Personal financial statements
C.  Warranties
D.  Stock certificates
E.  Checking account statements

4.  An example of a personal and employment document is a: 

A.  Social Insurance card.
B.  passbook.
C.  budget
D.  property tax bill.
E.  lease.

5.  A brokerage statement is an example of a(n) ____________ record. 

A.  investment
B.  insurance
C.  estate planning
D.  tax
Personal Finance Canadian Canadian 6th Edition Kapoor Test Bank
E.  consumer purchase
6.  Warranties are commonly associated with ____________ purchases. 

A.  investment
B.  insurance
C.  consumer
D.  financial services
E.  credit

7.  Which of the following are considered to be personal financial statements? 

A.  Budget and credit card statements
B.  Balance sheet and cash flow statement
C.  Checkbook and budget
D.  Tax returns
E.  Bank statement and savings passbook

8.  A personal balance sheet presents 

A.  items owned and amounts owed.
B.  income and expenses for a period of time.
C.  earnings on savings and investments.
D.  amounts budgeted for spending
E.  family financial goals.

9.  The current financial position of an individual or family is best presented with the use of a(n) 

A.  budget.
B.  cash flow statement.
C.  balance sheet.
D.  bank statement.
E.  time value of money report.

10. A family with $70,000 in assets and $22,000 of liabilities would have a net worth of: 

A.  $70,000.
B.  $22,000.
C.  $48,000
D.  $92,000.
E.  $41,000.

11. Items with a monetary worth are referred to as: 

A.  liabilities.
B.  variable expenses.
C.  net worth.
D.  income.
E.  assets.
12. Liquid assets refer to 

A.  amounts that must be paid soon.
B.  amounts on which taxes must be paid
C.  total income available to a family for spending.
D.  the value of investments.
E.  items that are easily converted to cash.

13. An individual retirement account is an example of a(n) ____________ asset. 

A.  liquid
B.  common
C.  investment
D.  household
E.  budgeted

14. Liabilities are amounts representing 

A.  taxable income
B.  items of value.
C.  living expenses.
D.  debts
E.  current assets.

15. Current liabilities differ from long­term liabilities based on 

A.  the amount owed.
B.  the financial situation of the creditor.
C.  the interest rate charged.
D.  when the debt is due.
E.  current economic conditions.

16. Ben Chase needs to pay off some of his debts over the next few months. Which item on his balance
sheet would help him decide what amounts are due in the near future? 

A.  the budget variance
B.  investment assets
C.  long­term liabilities
D.  current liabilities
E.  current assets

17. Which of the following would be considered a long­term liability? 

A.  A charge account payment
B.  A mortgage
C.  An installment loan
D.  An amount due for taxes
E.  The amount due on a credit card
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