2. 7.01-7.04 Review Personal Finance

3. Jim has term life insurance that is soon to expire; however, the policy allows him to continue the policy without getting a physical exam. Which type of insurance is this? A. Convertible B. Decreasing C. Level D. Renewable

4. Tim has life insurance that allows him to change the amount he pays and the amount of the death benefit. Which type of insurance is this? A. Limited-payment life B. Universal life C. Variable life D. Whole life

5. Janet can choose her doctors, pay for the services during her visit and then file insurance for reimbursement. Which insurance plan is this? A. Fee-for-service plan B. Health benefits C. Point-of-service D. Preferred provider

6. Mark recently left his job, but a law makes him eligible to keep his same health insurance for up to 18 months if he is willing to pay for it. Which insurance policy feature is this? A. COBRA B. FTC C. HMO D. MEDICAID

7. Will's insurance policy will pay his expenses for hospitalization, surgeries, and doctors' care. Which type of health insurance coverage is this? A. Accidental injury B. Basic medical benefits C. Long-term care D. Major medical

8. Trish plans to pay life insurance premiums for only a few years but have coverage for her full life. Which type of insurance is this? A. Limited-payment life B. Universal life C. Variable life D. Whole life

9. Pat has insurance that covers most of the costs of his cancer treatments over a period of several months. Which type of insurance is this? A. Dental B. Disability C. Major medical D. Vision

10. Nate has insurance that covered part of the costs of his stay in a rehabilitation center. Which type of insurance is this? A. Dental B. Long-term care C. Medical benefits D. Vision

11. When Ben selects health insurance for his employees, he wants the policy to include a feature that the policyholder and insurer will each pay a portion of the cost of the medical bills. Which insurance policy feature is this? A. Adjustable B. Deductible C. Guaranteed D. Right to transfer

12. Max received an annual statement that says the whole life policy he owned for ten years is now worth $1000. Which insurance policy feature is this? A. Cash value B. Dividends C. Face value D. Premiums

13. Since Janet was being treated for diabetes when she purchased health insurance, her health plan will not pay for her diabetes treatments. Which insurance policy feature is this? A. Open enrollment period B. Preauthorization C. Pre-existing condition D. Primary care

14. Mark has term life insurance that is about to expire; his policy allows him to modify the policy to make it permanent without taking a physical exam. Which type of insurance is this? A. Convertible B. Decreasing C. Level D. Renewable

15. Juan is willing to pay the premiums to have life insurance during his entire lifetime. Which type of insurance is this? A. Investment B. Level C. Permanent D. Renewable

16. Leon bought life insurance that allows him to borrow against it when he needs money for emergency expenses that. Which type of insurance is this? A. Convertible term B. Level term C. Renewable term D. Whole-life

17. Barry has been out of work for months because he has crippling arthritis. He receives monthly income from his insurance policy. Which type of insurance is this? A. Accidental injury B. Basic medical benefits C. Disability D. Major medical

18. Beth signed a loan agreement and then learned that the lender was a non-preferred lender. She wants to end the agreement. What should she do? A. Check to see if she has the right to rescission of this agreement within three days A. Check to see if she has the right to rescission of this agreement within three days B. Look for a lawyer and run a credit check on the lender B. Look for a lawyer and run a credit check on the lender C. Make the best of the situation since she has already signed the agreement C. Make the best of the situation since she has already signed the agreement D. Wait and see if the lender turns out to be credible D. Wait and see if the lender turns out to be credible

19. An ADVANTAGE of using credit is the: A. increase of debt resulting from credit use. B. payment of interest on the amount borrowed. B. payment of interest on the amount borrowed. C. potential to misuse credit and spend too much. C. potential to misuse credit and spend too much. D. use of goods and services while making payments. D. use of goods and services while making payments.

20. Creditors typically check a borrower's credit report as evidence of a borrower's: A. capacity. B. capital. C. character. D. condition.

21. Which purchase is most suitable for installment credit? A. Fast food meal B. Pair of movie tickets C. Refrigerator D. Gas for the car

22. Matthew was deeply in debt and decided to file Chapter 7 bankruptcy. What can be concluded about Matthew? A. He had to sell some of his personal belongings. A. He had to sell some of his personal belongings. B. He had enough money to pay all his bills. C. He was able to clear his credit report and start over. C. He was able to clear his credit report and start over. D. He was able to request a free credit report every twelve months. D. He was able to request a free credit report every twelve months.

23. Which is an example of a sub-prime or non- preferred lender? A. Carla went to a pawnbroker to get money in exchange for her mother's pearl ring. A. Carla went to a pawnbroker to get money in exchange for her mother's pearl ring. B. Dean borrowed money from the value of his life insurance policy. B. Dean borrowed money from the value of his life insurance policy. C. The Coleys obtained a home mortgage from the bank to buy their new home. C. The Coleys obtained a home mortgage from the bank to buy their new home. D. The Dells obtained a loan from a consumer finance company. D. The Dells obtained a loan from a consumer finance company.

24. A DISADVANTAGE of using credit is: A. buying items at a low price on sale. B. having a source of cash for emergencies. C. the convenience of paying on the Internet. D. the payment of interest on the amount borrowed. D. the payment of interest on the amount borrowed.

25. As Larry walked across campus, he was stopped by a representative of a credit card company recruiting college students to become cardholders in exchange for the free gift of two large soft drinks. What should he do? A. Avoid accepting the offer without thoroughly checking terms, including fine print A. Avoid accepting the offer without thoroughly checking terms, including fine print B. Find his friends so they can all benefit from the free drinks B. Find his friends so they can all benefit from the free drinks C. Leave his personal information so the representatives can contact him later C. Leave his personal information so the representatives can contact him later D. Walk the other way to avoid talking to the representatives D. Walk the other way to avoid talking to the representatives

26. Which is MOST suitable use of revolving credit? A. Buying a new automobile B. Buying new furniture for a bedroom C. Paying for electrical power for the past month C. Paying for electrical power for the past month D. Shopping for clothes in a retail department store D. Shopping for clothes in a retail department store

27. Which is a sign of debt problems? A. Mr. Jenkins is short-tempered because he's concerned about how he will pay the bills. A. Mr. Jenkins is short-tempered because he's concerned about how he will pay the bills. B. Mrs. Kline has a $10,000 credit limit and pays her balance in full each month. B. Mrs. Kline has a $10,000 credit limit and pays her balance in full each month. C. Ms. Lanning avoids the hassles of check- writing by using checking account drafts. C. Ms. Lanning avoids the hassles of check- writing by using checking account drafts. D. Ms. Martin saves 15% of her income each month. D. Ms. Martin saves 15% of her income each month.

28. Which is an example of a prime or preferred lender? A. Gregory obtained a payday loan but the interest rate was very high. A. Gregory obtained a payday loan but the interest rate was very high. B. Haley went to a loan shark when no one else would give her a loan. B. Haley went to a loan shark when no one else would give her a loan. C. Judy obtained a personal loan from the credit union. C. Judy obtained a personal loan from the credit union. D. Katie took jewelry to a pawnbroker to get some cash. D. Katie took jewelry to a pawnbroker to get some cash.

29. Which is a strategy for getting out of debt? A. Margie made a list of all her living expenses and amounts to repay debts each month. A. Margie made a list of all her living expenses and amounts to repay debts each month. B. Nora spent all of her savings and asked her uncle for a loan. B. Nora spent all of her savings and asked her uncle for a loan. C. Patrick obtained a cash advance to buy tickets to a concert. C. Patrick obtained a cash advance to buy tickets to a concert. D. Rita tried to open a new credit card account since her others had reached their limits. D. Rita tried to open a new credit card account since her others had reached their limits.

30. Credit applications usually request income information as evidence of a borrower's: A. capacity. B. capital. C. character. D. credit.

31. Jose is nineteen and is trying to establish credit. What should he do? A. Borrow a friend's credit card B. Fill out a college application C. Get a loan from his parents D. Get a secured credit card from a financial institution D. Get a secured credit card from a financial institution

32. A computer hacker transferred money from Shirley's bank account to the hacker's account. What financial transaction method was MOST LIKELY used? A. Electronic funds transfer B. Direct deposit and withdrawal C. Pay-by-phone transfers D. Point-of-sale transfer

33. Which password would be hard to guess? A. abcdefg B. Knjpol305 C. 1234567 D. password

34. Candace clicked the "buy now" button on the website. The address changed to https://. What could she conclude?https://. A. The website accepts credit cards. B. The website is out of order. C. The website is placing "cookies" in her browser. C. The website is placing "cookies" in her browser. D. The website uses secure measures for purchases. D. The website uses secure measures for purchases.

35. Evan warned his father not to leave his bank statements in the mailbox. What form of identity theft is he seeking to avoid? A. Looking at ID numbers at the ATM or checkout counter A. Looking at ID numbers at the ATM or checkout counter B. Posing as representatives of banks C. Stealing mail D. Stealing wallets or purses

36. Which is an example of ways thieves steal credit card numbers? A. Obtain cash with bank cards B. Open new accounts and make purchases C. Use technology to capture credit card number from magnetic strip C. Use technology to capture credit card number from magnetic strip D. Write checks on someone's bank account

37. Ashley wants to safely mail her bills. What should she do? A. Call and tell her creditors that checks are in the mail A. Call and tell her creditors that checks are in the mail B. Don't mail them when the weather is bad C. Mail them from a U.S. Post Office D. Put them in her mailbox immediately

38. Identity thieves MOST LIKELY would use fraudulently obtained bank account information to: A. obtain jobs. B. pose as representatives of banks. C. post personal information on the Internet. D. write checks on the account.

39. When Ted returned to the bookstore's website, it offered three books the store thought he would like. He can conclude that the store is: A. marketing goods and services based on preferences. A. marketing goods and services based on preferences. B. obtaining personal information submitted to the internet. B. obtaining personal information submitted to the internet. C. protecting sensitive personal information. D. stealing an important piece of personal information. D. stealing an important piece of personal information.

40. Rosie warned her mother not to respond to emails requesting she provide her bank account password. What form of identity theft is she seeking to avoid? A. Looking at ID numbers at the ATM or checkout counter A. Looking at ID numbers at the ATM or checkout counter B. Posing as representatives of banks C. Stealing mail D. Stealing wallets or purses

41. Kelsi's purse and credit card were stolen. What should she do? A. Call credit card company or bank to report the stolen card A. Call credit card company or bank to report the stolen card B. Call the Social Security Administration C. Mail a letter to the Social Security Administration C. Mail a letter to the Social Security Administration D. Shred her statement immediately

42. Which is a way to protect personal identity while making an online purchase? A. Provide Social Security number to the seller B. Use a credit card C. Use a debit card D. Use a secure website

43. Which is an example of sensitive personal information thieves obtain from digging through garbage? A. Food preferences B. What brand of household cleaner you use C. Where you bank D. Whether or not you recycle

44. Myron always leaves if he notices someone standing too close as he is making a financial transaction. What form of identity theft is he seeking to avoid? A. Their looking at the ID numbers at the ATM or checkout counter A. Their looking at the ID numbers at the ATM or checkout counter B. Posing as representatives of banks C. Stealing mail D. Stealing wallets or purses

45. Which is an example of an endorsement? Endorsement---statement of support for a product from a person other than the advertiser A. The ad read: "Twenty thousand teens couldn't be wrong. Use Ace and get rid of acne!" A. The ad read: "Twenty thousand teens couldn't be wrong. Use Ace and get rid of acne!" B. The ad read: "Use Fresh mouthwash. You'll be one of the 'In Crowd'!" B. The ad read: "Use Fresh mouthwash. You'll be one of the 'In Crowd'!" C. The radio commercial ended with: "Let Soothe & Smooth take you away." C. The radio commercial ended with: "Let Soothe & Smooth take you away." D. Your next-door neighbor said that Oops-Away was the best stain remover on the market. D. Your next-door neighbor said that Oops-Away was the best stain remover on the market.

46. Which is an example of escape advertising? Escape---associating products with beautiful, adventurous settings to create the illusion of escape for viewers A. The ad read: "Twenty thousand teens couldn't be wrong. Use Ace and get rid of acne!" A. The ad read: "Twenty thousand teens couldn't be wrong. Use Ace and get rid of acne!" B. The ad read: "Use Fresh mouthwash. You'll be one of the 'In Crowd'!" B. The ad read: "Use Fresh mouthwash. You'll be one of the 'In Crowd'!" C. The radio commercial ended with: "Let Soothe and Smooth take you away." C. The radio commercial ended with: "Let Soothe and Smooth take you away." D. The spokesperson said that Oops-Away was the best stain remover on the market. D. The spokesperson said that Oops-Away was the best stain remover on the market.

47. Which is an example of puffery? Puffery---exaggerated claims or descriptions intended to increase a product’s reputation or appeal; e.g., “great tasting”, “great hair” or “blondes have more fun” A. In the commercial, the subject wearing the advertised makeup took a lead role in the group. A. In the commercial, the subject wearing the advertised makeup took a lead role in the group. B. The ad read: "Use the latest and greatest, the best of the best, use On Cue deodorant." B. The ad read: "Use the latest and greatest, the best of the best, use On Cue deodorant." C. The designer clothing ad showed a slim, attractive young woman wearing a designer outfit. C. The designer clothing ad showed a slim, attractive young woman wearing a designer outfit. D. The spokesperson said: "No bad breath, no cold shoulders; stay fresh with Fresh mints." D. The spokesperson said: "No bad breath, no cold shoulders; stay fresh with Fresh mints."

48. Which is an example of a loss leader? Loss leader---item priced below retailer’s costs to attract customers to a store; often used in food stores A. Going to a cosmetics counter to pick up an advertised free gift, then finding that one must make a $25 purchase A. Going to a cosmetics counter to pick up an advertised free gift, then finding that one must make a $25 purchase B. Going first to a store because batteries were advertised two for the price of one, when most products are priced on the high side B. Going first to a store because batteries were advertised two for the price of one, when most products are priced on the high side C. Going to buy an advertised phone, finding that out of stock, then buying a higher-priced phone with extra features C. Going to buy an advertised phone, finding that out of stock, then buying a higher-priced phone with extra features D. Ordering the Monday night special in the restaurant before realizing that the price was the same as usual D. Ordering the Monday night special in the restaurant before realizing that the price was the same as usual

49. Which illustrates a consumer responding to coupons as an advertising and sales method? A. Being persuaded by a sales associate to purchase the cell phone with the most features A. Being persuaded by a sales associate to purchase the cell phone with the most features B. Buying a candy bar from the display next to the checkout counter B. Buying a candy bar from the display next to the checkout counter C. Mailing in proof of purchase and receiving 10% of the purchase price two weeks later C. Mailing in proof of purchase and receiving 10% of the purchase price two weeks later D. Using a newspaper clipping to save $1.50 when purchasing cereal D. Using a newspaper clipping to save $1.50 when purchasing cereal

50. Which is an example of trendsetter advertising? Trendsetter---a message that, if you use this product, you will stand out from the crowd A. In the commercial, the subject wearing the advertised makeup took a lead role in the group. A. In the commercial, the subject wearing the advertised makeup took a lead role in the group. B. The ad read: "Use the latest and greatest, the best of the best, use On Cue deodorant." B. The ad read: "Use the latest and greatest, the best of the best, use On Cue deodorant." C. The designer clothing ad showed a slim, attractive young woman wearing a designer outfit. C. The designer clothing ad showed a slim, attractive young woman wearing a designer outfit. D. The spokesperson said: "No bad breath, no cold shoulders; stay fresh with Fresh mints." D. The spokesperson said: "No bad breath, no cold shoulders; stay fresh with Fresh mints."

51. Which illustrates a consumer responding to rebates as an advertising and sales method? A. Being persuaded by a sales associate to purchase the cell phone with the most features A. Being persuaded by a sales associate to purchase the cell phone with the most features B. Buying a candy bar from the display next to the checkout counter B. Buying a candy bar from the display next to the checkout counter C. Mailing in proof of purchase and receiving 10% of the purchase price two weeks later C. Mailing in proof of purchase and receiving 10% of the purchase price two weeks later D. Using a newspaper clipping to save $1.50 when purchasing cereal D. Using a newspaper clipping to save $1.50 when purchasing cereal

52. Which illustrates a drawback of advertising--- getting misleading information? A. Ad photos making cold drinks look appealing, then buying an entire case for one person A. Ad photos making cold drinks look appealing, then buying an entire case for one person B. After seeing commercials that stressed a large selection, finding few items of interest B. After seeing commercials that stressed a large selection, finding few items of interest C. Clipping coupons from the paper every week before going to buy groceries C. Clipping coupons from the paper every week before going to buy groceries D. Hearing ads on the radio and knowing exactly where to go for the best fresh produce D. Hearing ads on the radio and knowing exactly where to go for the best fresh produce

53. Which illustrates a consumer responding to placement of high-profit items in prominent places as an advertising and sales method? A. Being persuaded by a sales associate to purchase the cell phone with the most features A. Being persuaded by a sales associate to purchase the cell phone with the most features B. Buying a candy bar from the display next to the checkout counter B. Buying a candy bar from the display next to the checkout counter C. Mailing in proof of purchase and receiving 10% of the purchase price two weeks later C. Mailing in proof of purchase and receiving 10% of the purchase price two weeks later D. Using a newspaper clipping to save $1.50 when purchasing cereal D. Using a newspaper clipping to save $1.50 when purchasing cereal

54. Which is an example of bandwagon advertising? Bandwagon---attempting to sell a product by convincing consumers that everyone is rushing to use and enjoy this product; peer approval A. The ad read: "Twenty thousand teens couldn't be wrong. Use Ace and get rid of acne!" A. The ad read: "Twenty thousand teens couldn't be wrong. Use Ace and get rid of acne!" B. The ad read: "Use Fresh mouthwash. You'll be one of the 'In Crowd'!" B. The ad read: "Use Fresh mouthwash. You'll be one of the 'In Crowd'!" C. The radio commercial ended with: "Let Soothe and Smooth take you away." C. The radio commercial ended with: "Let Soothe and Smooth take you away." D. The spokesperson said that Oops-Away was the best stain remover on the market. D. The spokesperson said that Oops-Away was the best stain remover on the market.

55. Which is an example of bait and switch? Bait and switch---retailer advertises a product, hoping to persuade customers to come and buy another product at a higher price; customer is often told the “bait” product is “sold out” A. Going to a cosmetics counter to pick up an advertised free gift, then finding that one must first make a $25 purchase A. Going to a cosmetics counter to pick up an advertised free gift, then finding that one must first make a $25 purchase B. Going to a store to buy home improvement supplies because batteries were advertised two for the price of one B. Going to a store to buy home improvement supplies because batteries were advertised two for the price of one C. Going to buy an advertised phone, finding that it is out of stock, then buying a higher-priced phone with extra features C. Going to buy an advertised phone, finding that it is out of stock, then buying a higher-priced phone with extra features D. Ordering the Monday night special in the restaurant before realizing that the price was the same as usual D. Ordering the Monday night special in the restaurant before realizing that the price was the same as usual

56. Which illustrates a benefit of advertising---that it helps save money? A. Ad photos making cold drinks look appealing, then buying an entire case for one person A. Ad photos making cold drinks look appealing, then buying an entire case for one person B. After seeing commercials that stressed a large selection, finding few items of interest B. After seeing commercials that stressed a large selection, finding few items of interest C. Clipping coupons from the paper every week before going to buy groceries C. Clipping coupons from the paper every week before going to buy groceries D. Hearing ads on the radio and knowing exactly where to go for the best fresh produce D. Hearing ads on the radio and knowing exactly where to go for the best fresh produce

57. Which is an example of an unfinished comparison? Unfinished comparisons---claiming a product “works better” --- better than what? A. Sharon recognized her favorite brand of tea by the symbol on the package. A. Sharon recognized her favorite brand of tea by the symbol on the package. B. The ad for laundry detergent read: "Cleans faster, brightens longer." B. The ad for laundry detergent read: "Cleans faster, brightens longer." C. The commercial ended: "Double your pleasure, double your fun, with Double-Good Gum." C. The commercial ended: "Double your pleasure, double your fun, with Double-Good Gum." D. The movie star said she used Sheen shampoo every day. D. The movie star said she used Sheen shampoo every day.