1. The Daniels have saved up a 2 months reserve fund but are still short of where they want to be. If their savings account has $4600 in it, and they want their reserve to be 5 times their monthly expenses, how much more do they need to add to the reserve fund? A) $6900

B) $9200

C) $4600

D) $2300

2. The James hold $11000 in their checking account for emergencies and earn 1% interest annually on the account. If they could earn 3% on a longer-term bank certificate of deposit, what is the annual opportunity cost incurred by the couple?

A) $330

B) $110

C) $440

D) $220

3. Linda and Robert are planning their budget for the next year. Their monthly fixed-rate mortgage payment is currently $1200 with monthly utilities amounting to $130. Assuming an inflation rate of 2%, what should they project for next year?

A) Mortgage payment of $1224 and taxes plus insurance of $133

B) Mortgage payment of $1200 and taxes plus insurance of $133

C) Mortgage payment of $1224 and taxes plus insurance of $130

D) Mortgage payment of $1200 and taxes plus insurance of $130

4. Which of the following is a nondepository institution? (Select any two.)

A) Mutual fund company

B) Online payment processor

C) Local bank

D) Savings and loan

5. You have estimated that you need $6,500 in liquid assets for an emergency fund. You currently have only $1,000, which is invested in a savings account earning 3 percent nominal interest, compounded monthly. Your current budget leaves $290 per month to apply to this goal. If you plan to add this money to your savings at the end of every month, how much will you have after one year? (Round answer to 0 decimal places, e.g. 1,250.)

6. Donna estimates that her take-home pay for the coming year will be $1420 per month. She expects total monthly expenses to be as follows: housing and utilities, $800; food, $200; auto, gas, and insurance, $220; credit card payment, $60; and other expenses $100. The balance on her credit card is $4300, and she currently pays 18 percent interest on this balance. Donna would like to reduce her credit card debt. If she decides to budget all of her net monthly cash flow to this goal, how long will it take (in months) to pay off her credit card? A) 61

B) 43

C) 70

D) 33

7. Your bank pays a nominal rate of 4.70% interest on a savings account. If the interest is compounded monthly, what is the annual percentage yield (APY) of this account? A) 4.70%

B) 5.10%

C) 4.80%

D) 4.84%