Multiple Choice
Identify the
letter of the choice that best completes the statement or answers the question.
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1.
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PL
HS 3.2.01 DOK 2
A common advantage of a checking account is
that:
a. | Every checking
account earns interest | c. | Banks automatically tell you when payments
are due | b. | Lost checks are insured by the federal
government | d. | Canceled checks can serve as proof of
payment | | | | |
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2.
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PL
HS 3.2.01 DOK 2
A business that receives an invoice with the terms 2/10,
n/30:
a. | Must pay the
entire amount right away | c. | Can deduct 2%
from the amount owed if payment is made within ten days | b. | Must pay $10 now and $30
later | d. | Does not have any time on the amount to be
paid | | | | |
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3.
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PL
HS 3.2.01 DOK 3
A fixed rate mortgage is recommended for home buyers
who
a. | Want to reduce
their property taxes | c. | Want to avoid the uncertainty of changing
interest rates | b. | Are in a low tax bracket | d. | Plan to move every few years to a new
home | | | | |
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4.
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PL
HS 3.2.01 DOK 2
When preparing a bank reconciliation, outstanding checks
are:
a. | Subtracted from
the bank balance | c. | Added to the checkbook
balance | b. | Added to the bank balance | d. | Subtracted from the checkbook
balance | | | | |
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5.
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PL HS
3.2.01 DOK 2
Which of the following formulas would use to calculate the amount of
interest earned on a 90 day certificate of deposit?
a. | Principal ÷ Rate x
Time | c. | Principal x Rate ÷ Time | b. | Principal ÷ Rate ÷
Time | d. | Principal x Rate x Time | | | | |
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6.
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PL
HS 3.2.01 DOK 2
Which of the following methods of calculating
finance charges is most appropriate for credit cards?
a. | Simple | c. | Average Daily Balance | b. | Compound | d. | Previous Balance | | | | |
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7.
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PL
HS 3.2.01 DOK 3
Which of the following investment options
would have the most advantages at retirement for a young person just beginning a
career?
a. | Individual
Retirement Account | c. | Stock | b. | Bond | d. | Certificate of Deposit | | | | |
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8.
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PL
HS 3.2.01 DOK 2
Which of the following is an example of a
capital investment in real estate?
a. | Fixing a broken fence | c. | Replacing faulty electrical
wiring | b. | Adding a bedroom above the
garage | d. | Repainting the front
porch | | | | |
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