q 1. A personal financial plan specifies financial goals and describes

Select one:

a. spending, saving, and credit card financing.

b. saving, investing, and asset valuation.

c. saving and spending only.

d. spending, financing, and investment plans.

Question 2

Opportunity cost refers to

Select one:

a. what you give up as a result of making a decision.

b. the non financial cost of a missed opportunity.

c. evaluating different alternatives for financial decisions.

d. money needed for major consumer purchases.

Question 3

John earns $3000 monthly income and he decides to set aside 10 percent as savings. In his savings, John wants to reserve 20 percent as his emergency fund. What amount should John accumulate as emergency fund annually?

Select one:

a. $60

b. $360

c. $720

d. $120

Question 4

Approximately what is the present value needed to receive $200 ten years from today, with an annual interest rate of ten percent?

Select one:

a. $97

b. $87

c. $77

d. $65

Question 5

Financial institutions quote rates with different compounding periods. What is the term for the actual interest rate paid or earned?

Select one:

a. Absolute

b. Real

c. Nominal

d. Effective