Final Exam - Summer Personal Finance

First Name:

Last Name:

1. Magda is going to finance her car purchase using an auto loan. Which statement below is accurate?

• Her principal is the cost of the car, minus any down payment she makes
• Her interest rate is the total cost she’ll pay after making all of her principal and interest payments
• Choosing a shorter term means it will take her longer to repay the loan
• It’s likely that her monthly payment will be between 4-5% of the cost of the car

2. Maria is new to budgeting. Maria’s friend advises them that they should “pay themselves first”. What does that mean?

• Maria should keep all their savings in a checking account
• Maria should automate monthly transfers to their savings account
• Maria should take more risk in their investments to get higher returns
• Maria should pay only the minimum due on their credit card bills

3. Why is sending a personalized thank you after a job interview important?

• It shows that you want the job even if you don’t really like the company
• You can apologize for any mistakes you made in the interview
• It gives you the opportunity to leave a good impression by expanding on an answer you gave or a topic you discussed
• It allows you to boast about your accomplishments one last time

4. What do you need to subtract from a college’s cost of attendance in order to find the net price?

• Student Aid Index
• Application fees
• Personal expenses
• Your grants and scholarships

5. All of the following are characteristics of a secured credit card EXCEPT…

• Your credit limit is dependent on the amount of your security deposit
• They lower the risk of banks when issuing credit to users with no credit history
• They help you build a credit history and improve your credit score
• They don’t have a spending limit, so you have to be very mindful of how much you buy with them

6. Zoe buys three new lipsticks from a store at the mall. Which payment method would reduce the amount of money in her checking account?

• Pays with a prepaid card she loaded earlier in the month
• Uses her credit card and says, "Credit" when the cashier asks, "Credit or debit?"
• Uses her debit card and says, "Credit" when the cashier asks, "Credit or debit?"
• Pays with cash she had in her purse

7. The monthly premium for Kevin’s renters insurance is $15, and his deductible is $500. During the month of April, someone breaks into his apartment and steals or destroys $2200 worth of his possessions. How much will Kevin pay and how much will the insurance pay to replace his items?

• Kevin pays $0 // insurance company pays $2200
• Kevin pays $15 // insurance company pays $2200
• Kevin pays $500 // insurance company pays $2200
• Kevin pays $500 // insurance company pays $1700

8. Which definition best describes the FAFSA?

• The amount of money the federal government offers you in student loans
• The paperwork your bank has you complete in order to take out a personal student loan
• The paperwork you complete in order to have part of or all of your student loan debt forgiven
• The application you submit in order to determine eligibility for federal student aid