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Exam 7: The Foundation of Savings

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Question 41

Multiple Choice

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Which of the following is not insured by the FDIC?

A) Retirement account.
B) Savings account.
C) Money market savings account.
D) Certificate of deposit.

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Question 42

Multiple Choice

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Which of the following refers to the combined maximum amount in 2018 that you can contribute to a Roth IRA and a traditional IRA?

A) $2,500.
B) $5,500.
C) $7,500.
D) $10,000.

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Question 43

Multiple Choice

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Which of the following refers to a traditional IRA?

Charlamagne has a goal of purchasing a condo at the beach within the next 10 years. He currently has $5,000 to put toward the down payment on the condo and does not anticipate using the funds for any other purpose. He would like to make a one-time deposit that can increase in value over the next 10 years. If Charlamagne already has his emergency fund in place, the best option for the $5,000 to grow and help him meet his goal would be to acquire a

Which of the following refers to assets that you purchase to reach long-term goals?

After purchasing a savings bond, how long is it before you can cash in the bond?

Xavier owned a Series EE savings bond for 4 years and has decided to cash it tomorrow. The current value of the bond is $3,500, and the annual interest rate is 2.2%. How much interest will Xavier lose as a penalty for cashing in the bond?

Which of the following illustrates making a trade-off between risk and return?

Fatima made an early withdrawal from her Roth IRA of $5,000 in principal and $800 in earnings. What would be the amount of penalty she would pay on this early withdrawal?

Which of the following needs to be very liquid, that is, immediately accessible for use in case of an unexpected expense or lost income?

Before ________ you could purchase a U.S. savings bond from participating banks or credit unions.

Which of the following refers to your perception of the riskiness associated with a behavior or decision?

Which of the following refers to the early withdrawal penalty on a Roth IRA?

Which of the following combines the benefits offered by savings and checking accounts?

Dedicated savings accounts pay interest rates similar to

Approximately what percent of individuals have sufficient funds to handle a pure risk?

Which of the following allows only a small amount of unearned income to be taxed at a child's marginal tax bracket?

Juan Carlos cashed in a savings bond that had earned $400 in interest. His tax bracket is 12%, and his state charges 6% on investment income. How much tax will Juan Carlos pay on the interest from the bond?

To protect yourself from financial fraud you should never

How can minors own titled assets?