Đề 506: Giống hệt 606 :)))

Part I: True or False

1. Closed-end credit consists of loans made on a continuous basis with periodic
bills for at least partial payment
→ False
Open-end credit consists of loans made a continuous basis with periodic bills for at
least partial payment
2. Insurance is protection against possible all loss.
→ False
Insurance is protection against possible financial loss.
3. The financial activities for a young, single person will probably be the same as
those for an older couple with no dependent children at home
→ False
(cần tìm giải thích)

4. Money management refers to annual financial activities necessary to manage

personal economic resources.
→ False
Money management refers to day-to-day financial activities.
5. If you are unable to make your credit card payments you should not contact
your credit card company
→ False
(kb giải thích ạ)

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 6. Because of the potential effect of inflation, individuals should underestimate
the amount of money needed for retirement.
→ False
Đoán là sai ở underestimate mà chưa tìm đc giải thích

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Part II: Exercises:

1. Gwendolyn Francis is interested in buying a bond that pays $70 annually. The
current price of the bond is $800. What is her current yield?
→ Current yield = Annual Cash Inflows / Market Price
= 70/800 = 8.75%
2. Marianne and Roger are in good health and have reasonably secure careers.
Each earns $45,000 annual. They own a home with a $125,000 mortgage;
they owe $25,000 for their car loans, and have $22,000 in student loans. If
one should die, they think that funeral expenses would be $12,000. What is
their total insurance needs using the DINK method?
→ The DINK Method uses the calculation of:
Total insurance needs = Funeral Expenses + 1/2(all loans + debt) = $12,000 + ½
(125,000 + 25,000 + 22,000) = $98,000

Part III: Mini Case

Consider Gretchen's budget worksheet for June, and then answer the questions that
follow
1. How much was Gretchen able to save in June?
2. Which sources of her income may not be the same from month to month?
3. Which types of spending might not be the same from month to month?
4. Why would a series of short-term budget worksheets be needed to develop a long-
term budget?

Income Spending

Date Source Amount Date Purpose Amount

7/6 wages 423.52 3/6 new sweater 33.86

9/6 birthday gift 50.00 12/6 car 48.29

insurance

21/6 wages 423.52 15/6 rent 350.00

23/6 babysitting 25.00 23/6 credit card 296.04

job bill

30/6 savings 8.92 25/6 telephone 53.41

interest bill

26/6 groceries 69.30

29/6 doctor's visit 50.00

Totals 930.96 900.90

1. Gretchen was able to save in June: Income - Spending = 30.06

2. Sources of income may not be the same from month to month are:
+ Birthday gift
+ Babysitting job
+ Saving interest
3. Types of spending might not be the same from month to month are:
+ new sweater
+ telephone bill
+ groceries
+ doctor's visit
+ credit card bill
4. We should develop a long-term budget because long-term amounts are often
difficult to change. So each month these amounts will be the same, thereby
making it easier for an individual to manage assets and save assets.
→ To take control of your financial situation, you should first create a series of short-term budget
worksheets. These are documents that record all income and spending that takes place over a
specific period of time, most often one month. When bills, such as insurance, are paid only once
or twice a year, you must include an appropriate share as spending in each worksheet
(cái này t tự ghi chứ k học hành gì)