Topic Test — Cumulative exam Answers

Sammy makes $2,362/month as a baseball coach. He is making a budget, and has created the following chart in order to divide his monthly paycheck into his various accounts:Expense type FrequencyAccountMonthly amountItemsEssential (fixed)MonthlyChecking$1,292Rent, car, insuranceEssential (variable)MonthlyChecking$420Basic groceries, telephone, electricity, cable TV, batting practiceNon-essentialMonthlyCash$260Snack items, restaurants, gifts, moviesOther (predictable)AnnualSavings$130Health exams, clothing, food, baseball coach magazineOther (unpredictable)AnnualEmergency savings$210Non-insured healthcare, repairs, and income replacementOther (long-term)5 yearsVacation savings$50VacationTotal $2,362 Sammy makes monthly deposits from each paycheck into the various accounts, and then spends from those accounts only for their defined purposes. He knows that it is not a perfect system, but thinks that it will help to assure coverage for future expenses. Using his essential expenses as a guideline, how much will Sammy need to save if he wants to have 3 times the amount of his living expenses in the bank as part of his emergency savings. How long will it take him to achieve his goal?a.$1,712; approximately 8 monthsb.$5,136; approximately 24 monthsc.$6,486; approximately 30 monthsd.$2,162; approximately 6 months

You work for a lender that requires a 15% down payment and uses the standard debt-to-income ratio to determine a person's eligibility for a home loan. Of the following, choose the person that you would rate the highest on their eligibility for a home loan. Person A Person B Person C Person D home value $95,000 $107,000 $120,000 $128,000 income $46,000 $53,000 $58,000 $60,000 savings $20,000 $13,910 $18,000 $19,200 recurring debt $310 $198 $265 $400 a. Person A b. Person B c. Person C d. Person D Please select the best answer from the choices provided

Sandy is trying to reconstruct her spending pattern from July. She knows that she had $277 in her account on July 1, but after that, her receipts and balance statements are all scrambled. Here are Sandy’s records:DateTransaction TypeAmount ($)7/26Purchase867/25Deposit767/4Purchase1377/6Deposit907/10Purchase1317/9Purchase1457/15Deposit1527/19Purchase137Assuming that this is a complete, if scrambled, record of Sandy’s July spending and that any overdraft fees incurred do not affect the running total, how many times did Sandy overdraw her account in July?a.Sandy never overdrew her account.b.Sandy only overdrew her account once.c.Sandy overdrew her account twice.d.Sandy overdrew her account more than twice.

Based on the above chart, which industry’s average annual rate of change is projected to decrease the most in the 2006-2016 period as compared to its average annual rate of change during 1996-2006? a. Utilities b. Educational services c. Federal government d. State and local government Please select the best answer from the choices provided

Rex has several hundred thousand dollars to save, and he wants to keep it as safe as possible. What would you recommend Rex do to keep his money safe?a.Deposit the money in a bank, ideally in a single well-protected account.b.Deposit the money in a bank, but in several different accounts.c.Deposit the money in several banks, not putting too much money in any one.d.Keep the physical cash at home in a fireproof safe.