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Personal Finance WISE Test questions and answers A+ score assured 2024/2025
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Personal Finance WISE Test questions and answers A+ score assured 2024/2025
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Personal Finance WISE TestInflation - ANSthe rise in the level of prices for goods and services
Time Value of Money - ANSthe increase of an amount of money due to earned interest or
dividends
Balance Sheet - ANSstatement that identifies the items you own, what you owe, and your
net worth
Paying Yourself First - ANSthe concept of setting aside a portion of your income for savings
before spending any of it
Commission - ANSa fee charged by a brokerage firm or investment bank to buy or sell
securities of an investor
Potential Earning Power - ANSthe amount of money you may earn over time
Finance Charge - ANSthe total dollar amount of interest you pay to use credit
Compounding - ANSthe process of earning interest on both the principal and any prior
interest earned in your account
Medicare - ANSis a government sponsored health care coverage for the elderly
Credit Limit - ANSThe maximum dollar amount of money the creditor will make available to
you on your credit card
Medicaid - ANSis a government sponsored health care plan for people with low income
Grace Period - ANSthe amount of time a credit card company provides before you incur
finance charges
Liquidity - ANSthe ability to easily convert your financial resources into cash without loss of
value
Annual Percentage Yield - ANSterm for the amount of interest that a $100 deposit would
earn after compounding for one year (as defined by law)
401(k) - ANSsets aside a portion of your pay, plus (usually) an employer match.
Economics - ANSThe study of the decisions that go into making, distributing and using
goods and services.
, Dealer Invoice Price - ANSPrice the car dealer paid to purchase the car from the
manufacturer.
Opportunity Cost - ANSA trade-off or what you are giving up when you make one choice
over another.
Diversification - ANSA strategy of investing in a broad range and number of companies in
order to limit the potential investment risk.
Deductible - ANSIs the amount of loss you pay out-of-pocket before the insurance company
pays their portion.
Networking - ANSA way of making and using contacts to get job information and advice.
Standard of Living - ANSThe measure of quality of life based on the amounts and kinds of
goods and services a person can buy.
Pension - ANSA retirement plan that is funded, at least in part, by an employer.
Net Worth - ANSDifference between what you own and what you owe.
Diversification & Professional Management - ANSAdvantages of a mutual fund.
Small Cap Stock - ANSA company with a market capitalization of $1 billion.
Budget Variance - ANSDifference between the budgeted amount and the actual amount
spent.
Revolver - ANSThe term banks use for someone who does NOT pay their credit card
balance in full each month, and instead incurs finance charges.
Credit CARD Act - ANSBans unfair rate increases, prevents unfair fee traps, protects
students and young people
2-4% - ANSWhat percent of your outstanding balance do credit card companies require you
to pay each month as your minimum?
$50 - ANSMaximum amount of fraudulent charges you are responsible for.
Greater than tax liability - ANSYou would be eligible for a tax refund if the amount withheld
from your paycheck is:
Bull Market - ANSA market where investors are optimistic about the economy and the
potential for stock growth.
Collision - ANSInsurance you use to repair your car when you hit a light pole.
Large Cap Stock - ANSA company with a market capitalization of $300 billion.
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