Arizona State University (ASU) FIN380 Personal Financial Management Test 3 Practice

These questions are part of the practice quiz. Start practicing

• What is the role of medical payments in a homeowner's insurance policy?
• Hybrid REITs are known for investing in which of the following?
• Who are the participants in the futures market referred to as hedgers?
• What typically starts at a deductible of $1,100 in health insurance?
• What is a defining feature of Real Estate Investment Trusts (REITs)?
• Which of the following best describes the strategy of a hedger?
• What is the maximum percentage for commissions on down payment (margin) in futures?
• Among the following types of homes, which typically appreciates in value?
• What is an example of an adjustment rate cap in an ARM loan?
• What is a unique feature of variable life insurance?
• What is the role of a speculator in the financial market?
• In the past, what was a common practice by homeowners to avoid mortgage insurance?
• How does whole life insurance differ from term insurance in terms of cost?
• Which of the following fees is specifically related to the evaluation of the property's value?
• A credit score is primarily based on which factor?
• What is a mortgage primarily considered to be?
• What is one disadvantage of trading options?
• What type of credit can often lead to excessive debt due to its accessibility and ease of use?
• Which type of loan typically requires collateral or a cosigner?
• How is the Net Asset Value (NAV) of a mutual fund calculated?
• What components are typically included in a homeowner's insurance policy?
• What is a pre-existing condition in the context of health insurance?
• What service does Consumer Credit Counseling Services (CCCS) primarily offer?
• Which type of mortgage loan offers a consistent interest rate throughout the loan term?
• What percentage of futures traders approximately lose money?
• What type of loan would typically not require a cosigner?
• What is the underwriting process in life insurance?
• Which national credit bureau is NOT mentioned in the text?
• To ensure adequacy, what should term insurance policies be guaranteed to include?
• In property insurance, what is the co-insurance requirement typically set at?
• Which term refers to the insurance that may be required in addition to regular mortgage payments for conventional loans?
• What should a mortgage payment alone ideally be, as a percentage of gross monthly income?
• Where is life insurance commonly obtained?
• What is the maximum liability on a stolen credit card under the Consumer Credit Protection Act?
• Which type of mutual fund can sell an unlimited number of shares?
• Which of the following credit types allows continued access to credit without a set repayment term?
• What is a management fee in the context of mutual funds?
• Which of the following is NOT typically a condition assessed under the Five Cs of Credit?
• Which type of insurance combines elements of term and whole life insurance?
• What type of insurance covers a portion of your take-home pay if you are unable to work?
• Under what circumstances can certain assets be retained in Chapter 7 bankruptcy?
• What is the main feature of a put option?
• Which approach to determining life insurance needs is based on an individual's salary and age?
• What is the purpose of "liability" coverage in insurance policies?
• What type of REIT invests exclusively in real estate properties?
• What is typically required of the insured under the co-insurance principle for property insurance?
• What is the primary objective of speculators in the market?
• What does whole life insurance guarantee?
• When do you have to pay prepaid interest on a mortgage?
• Which best describes consumer credit?
• What percentage of covered costs does an insurance company typically pay through co-insurance after the deductible is met?
• When considering all loan payments, what is the suggested maximum percentage of gross monthly income?
• What is a key feature of no load funds?
• Which of the following is NOT a type of consumer loan?
• What is a Health Reimbursement Account (HRA) primarily used for?
• Which term insurance option features a constant death benefit with potentially increasing annual premiums?
• What do hidden load funds typically charge for?
• What type of options can an option seller offer?
• What is a derivative?
• What type of insurance is purchased for a specific period of time and provides high coverage for the cost?
• What percentage of futures contracts are typically closed out before the actual delivery date?
• What is meant by "daily price limit" in the context of futures?
• What is the maximum annual interest rate allowed by Arizona usury laws?
• How does a Preferred Provider Organization (PPO) generally work?
• What kind of notice is required for interest rate increases according to the Credit Card Accountability Act?
• How is the total mortgage payment typically categorized?
• Which of the following is NOT one of the Five Cs of Credit?
• What is likely to be a reason for the higher cost of whole life insurance as compared to term insurance?
• What would a personal property floater typically be used for?
• What characterizes unsecured loans compared to secured loans?
• In the context of mortgages, who is referred to as the mortgagor?
• Which is a common reason for renting a home?
• Which type of insurance covers the current replacement cost of an asset?
• How soon do creditors need to resolve mistakes in a credit report under the Fair Credit Reporting Act?
• Which of the following is NOT a component of closing costs?
• What is a primary reason for investing in mutual funds?
• What type of credit requires full payment upon the completion of services rendered?
• Which feature of universal life insurance is notable?
• Which component of homeowner's insurance is designed to assist if your home is uninhabitable?
• Which of the following does NOT refer to a type of derivative?
• What does an Acceleration Clause allow a lender to do?
• What does a deductible refer to in health insurance?
• What is one reason people choose to purchase a home?
• Which of the following statements about co-insurance is true?
• Which fee is typically associated with the cost of obtaining a mortgage loan from the lender?
• What is typically the maximum percentage of the purchase price for a down payment when buying a home?
• Which of the following describes a situation where a high APR is assessed?
• On which day do most futures and options usually expire?
• Which service allows investors to switch between different mutual funds within the same family?
• Which are among the most expensive housing markets in the US?
• What does "selling naked" in finance refer to?
• What is generally true about the volatility of futures?
• In life insurance, what is most likely to affect the premium rates set by underwriters?
• What is a common advantage of using credit cards?
• Which advantage of owning a home is related to financial implications?
• What defines a subprime borrower?
• What type of option gives the holder the right to purchase shares?
• What is the primary purpose of a mutual fund's fee table?
• What is the full name of CBT, the trading exchange mentioned?
• What distinguishes a sliding fee scale in load funds?
• Who is classified as a beneficiary in an insurance context?
• What are futures contracts primarily concerned with?
• What is a key feature of decreasing term insurance?
• What does the term "endorsement" mean in the context of insurance?
• Which of the following is NOT typically considered a closing cost?
• What term is used to describe the lender in a mortgage agreement?
• What change to credit card eligibility does the Credit Card Accountability Act impose?
• What percentage of your take-home pay is considered good to keep your credit charges at?
• Which insurance scheme is generally more expensive than an HMO?
• Which of the following is NOT an aspect of a credit card?
• What type of insurance pays off your credit balance if you become ill or die?
• What does an automobile insurance policy typically include?
• What defines "purchase options" in investment terms?
• What does the standard notation (100/300/50) in automobile insurance represent?
• What is a key disadvantage of credit cards?
• What does POS stand for in health insurance terms?
• What do you call an option that gives you the right to sell beneath a specified price?
• What are load funds characterized by?
• What do Class B shares usually entail?
• What is the purpose of points in a mortgage transaction?
• Which bankruptcy chapter is typically utilized by high-income earners?
• What do Mortgage REITs primarily invest in?
• Which of the following is a key advantage of mutual funds?
• What characterizes a Unit Investment Trust (UIT)?
• Which position do hedgers typically take in the market?
• In the context of options, what does "selling covered" mean?
• What is the function of an umbrella policy in insurance?
• Where can you obtain an installment loan?
• What is the primary goal of the Equal Credit Opportunities Act?
• What is a key feature of the Fair Credit Billing Act?
• Which type of mutual fund is most common?
• In automobile insurance, what does "comprehensive coverage" typically cover?
• What defines a limited life policy?
• What type of fee structure is common with Class A shares?
• Which type of REIT primarily invests in commercial real estate such as shopping centers and office buildings?
• Which of the following details are included in the fee table of a mutual fund?
• What is NOT a factor that affects your credit score?
• What is one requirement under the Fair Credit Reporting Act?
• What does the term 'option seller' refer to in the options market?
• In a fixed rate mortgage, what percentage is an example of interest mentioned?
• What does a management fee in mutual funds typically cover?
• How much percentage of your credit score is determined by payment history?
• Which type of bankruptcy is known as the "wage earner plan"?
• What does a health savings account (HSA) allow?
• Which of the following is NOT one of the mutual fund services?
• What is the function of a prospectus in mutual fund investment?
• What type of insurance would typically amend a standard homeowner's policy to include protection against earthquakes?
• Which of the following represents the percentage of your credit score attributed to new credit?
• What is the general distinguishing characteristic of a POS plan?
• How many shares does a call option typically allow the purchase of?
• Where can investors find ratings for good mutual funds?
• Buying a home can serve all of the following purposes EXCEPT:
• What must credit card companies provide as part of their billing practices?
• What do major risk classifications and actuarial tables provide information about?
• What does the acronym PITI stand for in mortgage payments?
• Which of the following is an example of revolving credit?
• What distinguishes permanent life insurance from term insurance?
• Which item is required by law to be disclosed in a Loan Disclosure Statement?
• Class A shares of a mutual fund typically involve which of the following?
• Which coverage is typically not included in a standard homeowner's insurance policy?
• What is the advantage of smaller dollar investments in mutual funds?
• What are the key specifications included in every futures contract?
• Which of the following is NOT an advantage of options?
• What is the main benefit of using an HMO?
• What is often the consequence of not managing debts effectively?
• Which type of mortgage loans are guaranteed and insured by the government?
• What is the maximum out-of-pocket cost for an individual under a high deductible health care plan?
• What typically influences the share price of a closed-end mutual fund?
• What might a Recourse Clause entail when a borrower defaults?
• What does 'naked' refer to concerning options writing?
• Which act is commonly referred to as the "Truth in Lending Act"?
• What is the primary feature of actual cash value in insurance?
• What is a family of mutual funds?
• What is the cash value of whole life insurance often referred to as?
• Class C shares are known for which type of fee structure?
• Which of the following best describes short-term disability insurance?
• What type of credit requires a deposit to secure borrowing?
• What does comprehensive major medical insurance typically offer?
• Which of the following is NOT a type of home?
• What does long-term care insurance typically cover?
• What is the maximum contribution limit for an individual HSA?
• What distinguishes variable life insurance from whole life insurance?
• Which loan type allows for interest payments only during an initial period?
• What is a Balloon Payment?
• Where can detailed information about a mutual fund be found?
• What is a characteristic of whole life insurance?
• Why is having good credit important?
• Which of the following best describes replacement value in insurance?
• Approximately what percentage of adults own versus rent their homes?
• Which of the following reasons is a common barrier to home ownership?
• Which type of mortgage insurance is not guaranteed or insured by the government?
• What does the Homeowners Insurance Protection Act of 1998 require lenders to do when a homeowner's equity exceeds 22%?
• What does HMO stand for in the context of health insurance?
• What is an example of a "back-end load" in mutual fund investing?
• What does an escrow account do in the context of home buying?
• In what manner does a REIT typically operate in terms of share purchasing?