UGBA 135 COMPREHENSIVE STUDY GUIDE
2026 FULL QUESTIONS AND SOLUTIONS
GRADED A+
◍ If you are charged penalties and fees, do they charge interest on them?.
Answer: the next month you start paying a higher interest on balances and
fees
◍ # of disciplines.
Answer: 11NEVER borrow money to buy stocks.Market timing.It is best to
invest in stocks with money you won't need for 5 years.Identify
trends.Dollar-cost averaging is investing a set amount of money in shares of
stock on a regular time schedule, regardless of the price.Diversify.Stage and
stagger your purchases.Allocation of assets or rebalancing: Review the
allocation of assets in your portfolio at least once a year.In attempting to
forecast sales and earnings attributable to an individual share of stock, look
ahead 6-18 months.Do your homework!Keep it simple and stay informed.
◍ What is the concept of the time value of money?.
Answer: When you are young you can take advantage of time and
compounding to build your portfolio.Saving $100 at 8% compounded until
age 65:Starting at 22 = $450,000Starting at 32 = $195,000
◍ What is a sector fund?.
Answer: Similar to ETF except instead of tracking an index they track
stocks in a specific industryShares on sector funds trade on exchanges in the
open market like stocksAlways consider commissions and fees
◍ What is a proprietorship?.
Answer: A business owned by one person
◍ When bond prices go up, do the yields on interest rates also go up?.
, Answer: If a bond price increases, the yield will decrease
◍ How often are credit card balances calculated?.
Answer: daily
◍ How many times are corporate tax dividends taxed?.
Answer: twice
◍ Do shareholders in corporations have unlimited liability?.
Answer: No; shareholders have limited liability.
◍ What is a good dividend?.
Answer: Pays a higher percentage rate than what you can get from the
government in a 10 year treasury bond
◍ If you have 100,000 worth of earned income, how much would you be
paying for SS and Medicare?.
Answer: SS: 6.2%Medicare: 1.45%
◍ Definition of frugal.
Answer: they don't waste $ and are value orientedNot spending freely or
unnecessarily, but considering quality, value, needs, and benefits along with
price
◍ Cash advance.
Answer: -using your credit card to withdraw cash-higher interest rates, no
grace period (incur interest rates right off the bat)
◍ Trends (pg. 117-118).
Answer: -may be the most important thing you do in investing-look ahead
for 6-18 monthsTrends:-emerging market growth :: recognize accelerating
growth rate of emerging economies & slowing growth rate of many
developed economies-rising inflation and rising interest rates :: inflation ->
higher int rates -> price of market bonds decreases-the world is getting older
:: birth rates are declining. fewer young people to support needs of elders ->
increased demand for medical care, social services, etc.-raw materials are in
more remote and hard to reach areas-more people have higher
, incomes-environmental needs :: clean water. converting use of coal and
natural gas. includes protecting populations from nuclear disasters,
pollution, and rising sea levels
◍ Can you and your parents both claim you for a tax credit?.
Answer: No
◍ Are partners in partnerships liable for federal income taxes?.
Answer: No
◍ What are target funds?.
Answer: Moving from stocks toward bonds as you get older because it's
safer.Target is age
◍ What's the current maximum long term capital gains tax rate?.
Answer: Tax on profit or loss from the sale of an asset held for more than 12
monthsThe profit is subject to a maximum tax of 20% for singles and
married couples past a certain thresholdFor filers with incomes below the
threshold, the maximum tax is 15%
◍ What is a market order to buy? What is a market order to sell?.
Answer: Best available price at the moment in time for an immediate
execution or filling of that orderIf you place a market order to buy, expect to
buy at the ask priceIf you place a market order to sell, expect to sell at the
bid price
◍ What is alimony?.
Answer: A husband's or wife's court-ordered provision for a spouse after
separation or divorce.Pre 2019 alimony agreements remain tax deductible to
the payer and taxable income for the recipient. Grandfathered.
◍ You should always contribute enough to your 401K plan to get your
employer match.
Answer: True
◍ Bankruptcy handled in federal courts.
Answer: 2 types of bankruptcy:1. Liquidation of debt. (Federal court order):
2026 FULL QUESTIONS AND SOLUTIONS
GRADED A+
◍ If you are charged penalties and fees, do they charge interest on them?.
Answer: the next month you start paying a higher interest on balances and
fees
◍ # of disciplines.
Answer: 11NEVER borrow money to buy stocks.Market timing.It is best to
invest in stocks with money you won't need for 5 years.Identify
trends.Dollar-cost averaging is investing a set amount of money in shares of
stock on a regular time schedule, regardless of the price.Diversify.Stage and
stagger your purchases.Allocation of assets or rebalancing: Review the
allocation of assets in your portfolio at least once a year.In attempting to
forecast sales and earnings attributable to an individual share of stock, look
ahead 6-18 months.Do your homework!Keep it simple and stay informed.
◍ What is the concept of the time value of money?.
Answer: When you are young you can take advantage of time and
compounding to build your portfolio.Saving $100 at 8% compounded until
age 65:Starting at 22 = $450,000Starting at 32 = $195,000
◍ What is a sector fund?.
Answer: Similar to ETF except instead of tracking an index they track
stocks in a specific industryShares on sector funds trade on exchanges in the
open market like stocksAlways consider commissions and fees
◍ What is a proprietorship?.
Answer: A business owned by one person
◍ When bond prices go up, do the yields on interest rates also go up?.
, Answer: If a bond price increases, the yield will decrease
◍ How often are credit card balances calculated?.
Answer: daily
◍ How many times are corporate tax dividends taxed?.
Answer: twice
◍ Do shareholders in corporations have unlimited liability?.
Answer: No; shareholders have limited liability.
◍ What is a good dividend?.
Answer: Pays a higher percentage rate than what you can get from the
government in a 10 year treasury bond
◍ If you have 100,000 worth of earned income, how much would you be
paying for SS and Medicare?.
Answer: SS: 6.2%Medicare: 1.45%
◍ Definition of frugal.
Answer: they don't waste $ and are value orientedNot spending freely or
unnecessarily, but considering quality, value, needs, and benefits along with
price
◍ Cash advance.
Answer: -using your credit card to withdraw cash-higher interest rates, no
grace period (incur interest rates right off the bat)
◍ Trends (pg. 117-118).
Answer: -may be the most important thing you do in investing-look ahead
for 6-18 monthsTrends:-emerging market growth :: recognize accelerating
growth rate of emerging economies & slowing growth rate of many
developed economies-rising inflation and rising interest rates :: inflation ->
higher int rates -> price of market bonds decreases-the world is getting older
:: birth rates are declining. fewer young people to support needs of elders ->
increased demand for medical care, social services, etc.-raw materials are in
more remote and hard to reach areas-more people have higher
, incomes-environmental needs :: clean water. converting use of coal and
natural gas. includes protecting populations from nuclear disasters,
pollution, and rising sea levels
◍ Can you and your parents both claim you for a tax credit?.
Answer: No
◍ Are partners in partnerships liable for federal income taxes?.
Answer: No
◍ What are target funds?.
Answer: Moving from stocks toward bonds as you get older because it's
safer.Target is age
◍ What's the current maximum long term capital gains tax rate?.
Answer: Tax on profit or loss from the sale of an asset held for more than 12
monthsThe profit is subject to a maximum tax of 20% for singles and
married couples past a certain thresholdFor filers with incomes below the
threshold, the maximum tax is 15%
◍ What is a market order to buy? What is a market order to sell?.
Answer: Best available price at the moment in time for an immediate
execution or filling of that orderIf you place a market order to buy, expect to
buy at the ask priceIf you place a market order to sell, expect to sell at the
bid price
◍ What is alimony?.
Answer: A husband's or wife's court-ordered provision for a spouse after
separation or divorce.Pre 2019 alimony agreements remain tax deductible to
the payer and taxable income for the recipient. Grandfathered.
◍ You should always contribute enough to your 401K plan to get your
employer match.
Answer: True
◍ Bankruptcy handled in federal courts.
Answer: 2 types of bankruptcy:1. Liquidation of debt. (Federal court order):
