Wise Practice Test Exam Questions and Answers | Latest Update 2026 | Guaranteed Success

Wise Practice Test Exam Questions and Answers | Latest Update 2026 | Guaranteed Success Budget variance. - answer-the difference between the budgeted amount and the actual amount that you spend Debt ratio - answer-shows the relationship between debt and net worth. The lower the ratio the better off financially the person is. Debt ratio - answer-The lower the ratio the better off financially the person is. Debt ratio - answer-calculated by dividing liabilities by net worth Excise tax - answer-government imposes a tax on specific goods and services such as alcohol, cigarettes, gasoline, and airline Capital gains - answer-are profits made from the sale of capital assets such as stocks and bonds Capital gains - answer-tax deferred until the asset is sold, Capital Gains Tax - answer-If held over one year are considered long-term capital gains and are taxed at a lower tax rate or in some cases are not taxed at all. Variable expenses - answer-change from one period to another,examples Electricity and food expenditures Get advice from your friends - answer-will help you the least in managing your money?Financial planning - answer-the process of developing and implementing a coordinated series of actions to achieve financial success. Financial planning - answer-need to be reviewed and adjusted to accommodate changing needs and goals. Emergency fund - answer-Should be an important consideration when saving money Liquidity - answer-being in cash or easily convertible to cash, How easily an asset can be converted into cash Social Security - answer-benefits depends on the person?s earnings over a lifetime of work Department store charge cards. - answer-open-end credit Department store charge cards. - answer-is a revolving live of credit that is offered by banks There is a limit set on the line of credit and the funds Mortgage loan - answer-closed-end credit,made at a specified interest rate for a specified time period. Collateralize loan. - answer-A loan that is secured by collateral, properties or assets that are subject to seizure on default. Collateral loan. - answer-When a person brings an item to a pawnshop to obtain cash, the transaction is considered Federal Housing Administration (FHA) loan - answer-insures lenders who make mortgage loans that are riskier than regular bank loans because Uncollateralized loan - answer-A personal loan without assets to cover the loan amount.Collateral - answer-tangible asset that is used to secure a loan. In the case of a mortgage, the actual house or apartment serves as the collateral for that loan. Bankruptcy - answer-will appear on the person?s credit report for 10 years Notify the credit card companies in order to negotiate a new payment plan. - answer-Notify the credit card companies in order to negotiate a new payment plan. Installment loan - answer-a loan repaid with interest in equal periodic payments Dispose of a credit card - answer-Cut up the card, put parts in different garbage bags, and instruct the credit card company in writing or by phone to close the account Garnishment - answer-Occurs when a creditor obtains a court order requiring an employer to attach an employee's earnings in order to pay back a debt. Rate of inflation - answer-determines the time value of depositing into a savings account, and the interest rate and Rising interest - answer-Can lower stock prices because of lower business profits Short-term savings instruments - answer-your money will be available to invest in a higher interest instrument in the near future. Short-term savings instruments - answer-Which investment would you choose today if you believe interest rates will go up? Credit unions - answer-Credit unions usually pay the highest rates of interest because they have lower risks and costs of operation. They are not-for-profit organizations Truth in Lending Act - answer-The Truth in Lending Act requires that the finance charge and annual percentage rate be disclosed to the consumer in advance