#1
Which of the following is a common type of personal finance account?
Savings account
Corporate account
Insurance account
Investment account
#2
What does the term 'budget' refer to in personal finance?
A plan for spending and saving money
The total amount of money a person earns
A type of loan provided by a bank
The process of investing in the stock market
#3
What is the purpose of emergency savings?
To make impulsive purchases
To save for long-term goals
To cover unexpected expenses
To invest in high-risk assets
#4
What is the concept of 'diversification' in investment?
Putting all investment funds in one type of asset
Spreading investment funds across different types of assets
Investing only in international markets
Investing in high-risk assets
#5
Which of the following is NOT a type of insurance typically considered in personal finance?
Health insurance
Home insurance
Car insurance
Stock insurance
#6
What is the purpose of a credit score in personal finance?
To determine one's eligibility for a job
To evaluate one's ability to repay borrowed money
To assess one's proficiency in budgeting
To measure one's knowledge of financial literacy
#7
Which of the following is a characteristic of a 529 plan?
It is used for retirement savings
It is funded with after-tax dollars
It is only available to high-income earners
It is intended for college savings
#8
What does APR stand for in the context of personal finance?
Annual Percentage Rate
Average Profit Ratio
Asset Portfolio Return
Adjusted Payment Rate
#9
Which of the following is considered a form of 'passive income'?
Salary from employment
Interest from a savings account
Bonus from work performance
Commission from sales
#10
What is the primary function of a 401(k) retirement account?
To provide health insurance benefits
To offer short-term loans
To save for college education
To save for retirement
#11
Which of the following is an advantage of investing in mutual funds?
High liquidity
Limited diversification
Potential for high returns
Active management fees
#12
What is the main advantage of a Roth IRA compared to a traditional IRA?
Tax-deductible contributions
Tax-free withdrawals in retirement
No contribution limits
Higher contribution limits
#13
What does the term 'liquidity' refer to in personal finance?
Ability to convert assets into cash quickly
Amount of debt a person carries
Rate of return on investments
Risk associated with an investment
#14
What does the term 'net worth' represent in personal finance?
Total income earned in a year
Total assets minus total liabilities
Total amount of savings
Total value of investments
#15
What is the concept of 'compounding interest' in personal finance?
Interest paid on the original principal and on the accumulated past interest
Interest charged on overdue payments
Interest rate that varies based on market conditions
Interest paid only once at the end of the investment period
#16
Which of the following is NOT a factor affecting one's credit score?
Credit utilization
Length of credit history
Income level
Types of credit in use
#17
What is the purpose of asset allocation in investment?
To concentrate investments in a single asset class
To reduce investment risk
To speculate on short-term price movements
To maximize taxes on investment gains
#18
Which of the following is a characteristic of a bear market?
Rising stock prices
Positive investor sentiment
Declining stock prices
High levels of economic growth
#19
What is the purpose of a will in personal finance?
To transfer ownership of real estate
To specify funeral arrangements
To distribute assets after death
To establish a trust fund
#20
Which of the following is NOT a factor that affects an individual's credit score?
Payment history
Credit utilization
Age
Income level