Answers2027 Ignite Financial Literacy-Personal Finance - EL3403Principles of Financial Planning

Principles of Financial Planning Answers

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1
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When studying finance or economics, the cost of a decision is also known as a(n)

A
personal cost.
B
financial cost.
C
long-term cost.
D
opportunity cost.
2
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In American society, which of these is an example of a want?

A
food
B
shoes
C
video games
D
utility bills
3

How do short-term financial goals differ from long-term financial goals?

A
Short-term goals involve more planning than long-term goals.
B
Short-term goals are more affordable than long-term goals.
C
Short-term goals cost more than long-term goals in the long run.
D
Short-term goals are more immediate than long-term goals.
4

Planning to finance higher education helps people prepare for their financial future because it teaches them about

A
loans and interest.
B
savings accounts.
C
filing taxes.
D
short-term goals.
5

Planning to finance higher education helps people prepare for their financial future because it teaches them about

A
loans and interest.
B
savings accounts.
C
filing taxes.
D
short-term goals.
6

This chart shows Dan’s budget:

Question illustration
A
Yes, Dan spent as much as he earned.
B
No, Dan should lower his savings account contribution.
C
Yes, Dan used his savings to cover extra expenses.
D
No, Dan should reduce his discretionary spending.
7

Which would be most helpful when considering a large expenditure that might require repeating payments? Select three options.

A
careful consideration of short-term goals
B
recording the number of assets you currently own
C
creating a budget to consider future income and spending
D
learning more about different kinds of accounts to manage money
E
learning about opportunity cost
8

What is included in an individual’s personal assets? Select three options.

A
number of dependents
B
money
C
career
D
property
E
investment
9

_____ are items such as utilities, rent, and food—items that one can’t do without.

A
Needs
B
Wants
C
Risks
D
Assets
10

What are the main purposes of a budget? Select three options.

A
to record past income and spending
B
to take out a student loan from the bank
C
to plan future income and spending
D
to apply for a mortgage
E
to balance available resources and expenses

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