Use the following data to answers Questions $1$ through $5$:

Monthly expenses $=$ $$4,000$

Monthly gross income $($after taxes$)=$ $$5,500$

Savings Account Value $=$ $$6,000$

Total Assets $($excluding house$)=$ $$120,000$

Total Liabilities $($excluding mortgage$)=$ $$20,000$

Question $1(2$ points$)$

Calculate the annual Net Income for this individual.

Question $1$ options:

$$1,500$

$$18,000$

$$24,000$

$$100,000$

None of the above.

Question $2(2$ points$)$

Calculate the Basic Liquidity Ratio for this individual.

Question $2$ options:

$0\mathrm{.}3$

$1\mathrm{.}1$

$1\mathrm{.}5$

$30\mathrm{.}0$

None of the above.

Question $3(1$ point$)$

How would you interpret the result for this individual's Basic Liquidity Ratio?

Question $3$ options:

The Basic Liquidity Ratio for this individual is above the recommended benchmark.

The Basic Liquidity Ratio indicates that this individual should set aside more monetary assets for emergency purposes.

This individual does not have enough monetary assets to cover a single month of personal expenses.

Both b$.$ and c$.$ above.

Question $4(1$ point$)$

Using the above information, calculate the Debt$-$to$-$Equity Ratio for this individual.

Question $4$ options:

$16\mathrm{.}7\%$

$20\mathrm{.}0\%$

$30\mathrm{.}3\%$

$72\mathrm{.}7\%$

None of the above.

Question $5(1$ point$)$

How would you interpret the Debt$-$to$-$Equity Ratio for this individual?

Question $5$ options:

The Debt$-$to$-$Equity Ratio for this individual is at an appropriate level.

The Debt$-$to$-$Equity is higher than the benchmark rule.

The total liabilities for this individual is too high relative to the individual's net worth.

Question $6(1$ point$)$

Which of the following activities is a good method for building a strong credit history?

Question $6$ options:

Avoiding all debt liabilities such as credit cards and loans.

Keeping monthly bills in your name and paying them on time.

Maintaining a credit card and paying any balances in full.

Both b$.$ and c$.$ above.

Question $7(1$ point$)$

According to the "Risk Pyramid", which of the following investment vehicles ranks the highest in terms of risk?

Question $7$ options:

Growth mutual funds

Municipal bonds

Blue$-$chip stocks

Put options

Question $8(1$ point$)$

Which of the following regarding personal retirement plans is false?

Question $8$ options:

Contributions for a Roth IRA are tax$-$deductible.

Earnings on both Traditional and Roth IRAs grow tax$-$free.

Keogh plans are primarily for those individuals who are self$-$employed.

During retirement, the investor must pay taxes on withdrawals from the traditional IRA.