True/False
Indicate whether the
sentence or statement is true or false.
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1.
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Warranties may be in writing or assumed to exist.
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2.
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When your debts are greater than your assets, you are said to be solvent, or in
a favorable credit position.
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3.
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Receipts are valuable to use as evidence or proof of payment.
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4.
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Fixed expenses will change according to a family’s needs and short-term
goals.
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5.
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Most financial experts recommend that a family have no more than 50-60 percent
of take-home pay set aside for fixed expenses.
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Multiple Choice
Identify the
letter of the choice that best completes the statement or answers the question.
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6.
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A budget
a. | is a plan to match spending with saving | c. | is a plan to match expected income
with expected outflow | b. | is a plan to increase
income | d. | will decrease your
wants and needs |
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7.
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Savings, house payments, and utilities are all examples of
a. | disposable income | c. | variable expenses | b. | fixed expenses | d. | personal
records |
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8.
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An agreement which is missing an essential element, such as consideration is
a. | valid | c. | void | b. | voidable | d. | illegal |
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9.
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A mortgage or lease is an example of a(n)
a. | implied contract | c. | oral contract | b. | express contract | d. | warranty or
guarantee |
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10.
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Lunches, medical bills, personal care items, and clothing are all examples
of
a. | income | c. | variable expenses | b. | fixed expenses | d. | investments |
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11.
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The IRS can audit your tax returns for a period of ___ years, except in the case
of fraud, where there is no time limit.
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12.
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The price, which may be in the form of money, a promise, or a performed act, is
known as a(n)
a. | offer | c. | competent parties | b. | acceptance | d. | consideration |
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13.
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A person who creates or signs a promissory note is called the
a. | payee | c. | cosigner | b. | maker | d. | agent |
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14.
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When your assets are greater than your liabilities, you are said to be
a. | responsible | c. | solvent | b. | insolvent | d. | rich |
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15.
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Intentional misrepresentation of a material fact is called
a. | duress | c. | undue influence | b. | mistake | d. | fraud |
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Matching
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a. | void | h. | cosigner | b. | maker | i. | inventory | c. | competent
parties | j. | promissory
note | d. | instruments | k. | implied | e. | legally collectible | l. | contract | f. | voidable | m. | solvent | g. | payee |
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16.
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A warranty that is assumed to exist.
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17.
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The meaning of the phrase negotiable instrument.
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18.
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One who agrees to pay a note if the maker does not pay.
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19.
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The person who creates and signs a note.
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20.
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The person to whom a note is made payable.
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21.
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A written promise to pay on a specified date.
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22.
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A person is ____ if he or she can pay all bills as they are due.
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23.
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Contracts that are missing one or more essential ingredients.
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24.
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Contracts that contain an element that could make them unenforceable.
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25.
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Persons who are legally able to give sane and intelligent consent and enter
into contracts.
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