Please check my answers.
1. John Gray bought a basic car for $8,250.00, with options that cost $324.00. There's a 6% sales tax in
his state and a combined $50.00 license and registration fee. What was John's total cost?
A. $9,138.44
B. $10,000.00
C. $9,141.44
D. $14,247.00
2. Which of the following is intended primarily to enhance a person's tax advantage and retirement income?
A. U.S. Savings Bond
B. Growth fund
C. Money market fund
D. IRA
3. A _______ is a group of people who agree to save their money together and to make loans to each other
at a relatively low rate of interest.
A. investment firm
B. credit union
C. commercial bank
D. Christmas club
4. A share of stock in the Lofty Cheese Company is quoted at 25 1/4. Suppose you hold 30 shares of that
stock, which you bought at 20 1/4. If you sell your stock at 25 1/4, which one of the following statements
would be true?
A. You'll suffer a loss of $15.
B. You'll make a profit of $150.
C. You'll make a profit of $15.
D. You'll suffer a loss of $150.
5. The Waverly Brush Company issued 4,000 shares of common stock worth $200,000.00 total. What is
the par value of each share?
A. $500
B. $40
C. $50
D. $400
6. In a health insurance policy, a statement that an applicant won't be covered for a certain pre-existing
condition is called a/an
A. major medical coverage.
B. exclusion.
C. supplement.
D. waiting period.
7. _______ health insurance coverage pays for at least part of hospital costs and fees.
A. Basic
B. Major medical
C. HMO
D. PPO
8. The Hamilton Brush Company issued 2,500 shares of common stock worth $100,000.00 total. What is
the par value of each share?
A. $400.00
B. $250.00
C. $25.00
D. $40.00
9. If you have earned income, which of the following retirement devices must you contribute to, by law?
A. Social security (FICA)
B. Pension plan
C. Vesting plan
D. IRA
10. What is the first step that a smart new-car buyer should take before talking to salespersons and putting
a deposit on a car?
A. Test-drive the car.
B. Study the car market.
C. Shop around for a car loan.
D. Obtain car insurance.
11. A _______ is invested by managers in a diversity of stocks, bonds, and other securities.
A. mutual fund
B. preferred stock
C. promissory note
D. series EE bond
12. A share of stock in the Bree Medical Supply Company is quoted at 35 1/4 . Suppose you hold 20
shares of that stock, which you bought at 31 1/2. If you sold your stock at 35 1/4, which of the following
would be true?
A. You made a profit of $705.00.
B. You suffered a loss of $75.00.
C. You suffered a loss of $630.00.
D. You made a profit of $75.00.
13. Jane Marko buys a car for $11,400.00. In three years, the car depreciates 48% in value. How much is
the car worth in three years?
A. $5,472.00
B. $4,788.00
C. $3,800.00
D. $5,928.00
14. A master plan is devised for
A. short-term goals.
B. long-range goals.
C. investments.
D. emergencies.
15. Ray Cupple bought a basic car costing $10,150.00, with options costing $738.00. There is a 6% sales
tax in his state and a combined $50.00 license and registration fee. What was Ray's total cost?
A. $11,547.00
B. $10,938.00
C. $11,541.28
D. $11,591.28
16. The Emerson First National Bank is lending you money to buy a new car. The loan agreement will
probably state that you must carry _______ insurance.
A. medical
B. no-fault
C. liability
D. collision
17. Your _______ should furnish enough money to live on, in an emergency, for six months.
A. savings
B. investments
C. IRA
D. interest
18. With _______ insurance, the insured agrees to pay a specific premium each year until death.
End of exam
A. limited-payment
B. whole-life
C. half life
D. endowment life
19. Which of the following devices imparts ownership in a corporation?
A. U.S. Treasury Bill
B. Bond
C. Stock
D. Savings account
20. The major difference between a calculator and a computer, when performing calculations, is that a
A. computer is slower but needs less human assistance.
B. calculator is faster but needs more human assistance.
C. computer is faster but needs more human assistance.
D. calculator is slower and needs more human assistance.
Here's my answers
1. A 11. A
2. D 12. D
3. B 13. D
4. B 14. B
5. C 15. D
6. B 16. D
7. D 17. A
8. D 18. B
9. A 19. C
10. B 20. C
The following arithmetic questions are correct :
1 3 4 5 8 11 12 13 15 18 19 20
#10 -- I would say all of the above
#2 -- I live in Canada, so I should not comment on US practice
#6 #7 , no idea since we have universal health care where 100% of hospital etc is covered .
#9 - don't know US laws
#14 ??
#16 - I "must" carry liability insurance on car insurance, would think the US would be the same
#17 -- ?
#4: Correct B.
Which one of the following items is an example of solfware?
Max brought a backpack that cost 40.00. The sales tax in his state is 8%. what is the final amount that Max has to pay for the backpack?
1. To calculate the total cost, you first need to add the cost of the basic car and the cost of the options. So, $8,250.00 + $324.00 = $8,574.00.
Next, you need to calculate the sales tax on the total cost. Multiply the total cost by the sales tax rate (6% or 0.06). So, $8,574.00 * 0.06 = $514.44.
Finally, add the license and registration fee to the total cost. So, $8,574.00 + $50.00 = $8,624.00.
Therefore, the correct answer is option B. $8,624.00.
2. The correct answer is option D. IRA. An Individual Retirement Account (IRA) is intended primarily to enhance a person's tax advantage and retirement income.
3. The correct answer is option B. Credit union. A credit union is a group of people who agree to save their money together and make loans to each other at a relatively low rate of interest.
4. To determine the profit or loss, you need to calculate the difference between the selling price and the buying price. The selling price is 25 1/4, which is equivalent to 25.25 in decimal format. The buying price is 20 1/4, which is equivalent to 20.25 in decimal format.
The difference between the selling price and the buying price is 25.25 - 20.25 = 5.
To determine the profit or loss, multiply the difference by the number of shares owned: 5 * 30 = 150.
Therefore, the correct answer is option B. You'll make a profit of $150.
5. To find the par value per share, divide the total value of the common stock ($200,000.00) by the number of shares (4,000).
So, $200,000.00 / 4,000 = $50.
Therefore, the correct answer is option C. $50.
6. The correct answer is option B. Exclusion. In a health insurance policy, a statement that an applicant won't be covered for a certain pre-existing condition is called an exclusion.
7. The correct answer is option B. Major medical. Major medical health insurance coverage pays for at least part of hospital costs and fees.
8. To find the par value per share, divide the total value of the common stock ($100,000.00) by the number of shares (2,500).
So, $100,000.00 / 2,500 = $40.
Therefore, the correct answer is option D. $40.00.
9. The correct answer is option A. Social security (FICA). If you have earned income, you are required by law to contribute to social security (FICA).
10. The first step a smart new-car buyer should take before talking to salespersons and putting a deposit on a car is to study the car market. So, the correct answer is option B. Study the car market.
11. The correct answer is option A. Mutual fund. A mutual fund is invested by managers in a diversity of stocks, bonds, and other securities.
12. To determine the profit or loss, you need to calculate the difference between the selling price and the buying price. The selling price is 35 1/4, which is equivalent to 35.25 in decimal format. The buying price is 31 1/2, which is equivalent to 31.50 in decimal format.
The difference between the selling price and the buying price is 35.25 - 31.50 = 3.75.
To determine the profit or loss, multiply the difference by the number of shares owned: 3.75 * 20 = 75.
Therefore, the correct answer is option D. You made a profit of $75.00.
13. To calculate the car's worth after depreciation, multiply the original price by the percentage of depreciation (48/100 or 0.48).
So, $11,400.00 * 0.48 = $5,472.00.
Therefore, the correct answer is option A. $5,472.00.
14. A master plan is generally devised for long-range goals. So, the correct answer is option B. Long-range goals.
15. To calculate the total cost, you first need to add the cost of the basic car and the cost of the options. So, $10,150.00 + $738.00 = $10,888.00.
Next, you need to calculate the sales tax on the total cost. Multiply the total cost by the sales tax rate (6% or 0.06). So, $10,888.00 * 0.06 = $653.28.
Finally, add the license and registration fee to the total cost. So, $10,888.00 + $50.00 = $10,938.00.
Therefore, the correct answer is option B. $10,938.00.
16. The correct answer is option D. Collision. The loan agreement from the bank will likely state that you must carry collision insurance.
17. An emergency fund should ideally furnish enough money to live on for six months. So, the correct answer is option A. Savings.
18. The correct answer is option B. Whole-life. With whole-life insurance, the insured agrees to pay a specific premium each year until death.
19. The device that imparts ownership in a corporation is a stock. So, the correct answer is option C. Stock.
20. The major difference between a calculator and a computer when performing calculations is that a calculator is faster but needs more human assistance. So, the correct answer is option B. Calculator is faster but needs more human assistance.