#1
What is the meaning of APR in personal finance?
Annual Percentage Rate
Average Personal Returns
Asset Portfolio Ratio
Annual Profit Return
#2
Which of the following is a type of retirement account commonly used in the United States?
401(k)
IRA
RRSP
All of the above
#3
What does the term 'compound interest' refer to in personal finance?
Interest calculated on the initial principal and also on the accumulated interest
Interest paid only once on the initial principal
Interest earned through short-term investments
Interest waived by lenders
#4
What is the purpose of an emergency fund in personal finance?
To invest in long-term assets
To cover unexpected expenses
To pay off debt
To fund daily expenses
#5
What does the term 'capital gains' refer to in personal finance?
Profit from the sale of an investment or asset
Interest earned on savings accounts
Debt incurred from investments
Initial investment amount
#6
What does ROI stand for in personal finance?
Return on Investment
Revenue Over Inflation
Rate of Interest
Risk of Investment
#7
What is the 'Rule of 72' used for in personal finance?
Calculating compound interest
Determining credit score
Predicting stock market trends
Estimating time to double an investment
#8
What is the concept of 'asset allocation' in personal finance?
Diversifying investments among different asset classes
Allocating all investments into a single asset class
Investing only in high-risk assets
Avoiding investment entirely
#9
Which of the following is a characteristic of a Roth IRA?
Tax deduction on contributions
Tax-free withdrawals in retirement
Penalty-free withdrawals before retirement
Required minimum distributions (RMDs) at age 70½
#10
What does the term 'FICO score' represent in personal finance?
Credit score calculated by Fair Isaac Corporation
Interest rate on federal loans
Savings account interest rate
Investment portfolio performance
#11
What is the primary function of a budget in personal finance?
To restrict spending
To allocate income
To increase debt
To minimize savings
#12
What does the term 'liquidity' mean in personal finance?
Ability to convert assets into cash quickly without significant loss of value
Long-term investment strategy
High-risk investment
Inability to access funds
#13
What does 'asset under management (AUM)' mean in personal finance?
Total value of assets managed by a financial institution
Investment fees charged by financial advisors
Total value of personal assets
Net worth of an individual
#14
What does the term '401(k) match' mean in personal finance?
Employer's contribution to an employee's retirement account
Tax deduction for retirement contributions
Annual return on retirement investments
Penalty for early withdrawal from retirement account
#15
What does the term 'tax deduction' mean in personal finance?
Reduction in taxable income
Increase in taxable income
Tax-free income
Capital gains tax