test bank for personal financial planning, 16th
edition by randy billingsley, lawrence gitman,
michael joehnkall chapters 1-15| latest 2025 a+
, table of contents
part i: foundations of financial planning.
1. understanding the financial planning process.
2. developing your financial statements and plans.
3. preparing your taxes.
part ii: managing basic assets.
4. managing your cash and savings.
5. making automobile and housing decisions.
part iii: managing credit.
6. using credit.
7. using consumer loans.
part iv: managing insurance needs.
8. insuring your life.
9. insuring your health.
10. protecting your property.
part v: managing investments.
11. investment planning.
12. investing in stocks and bonds.
13. investing in mutual funds and real estate.
part vi: retirement and estate planning.
14. planning for retirement.
15. preserving your estate.
,chapter 1—understanding the financial planning process
true/false
1. standard of living is defined as the necessities, comforts, and luxuries desired by an individual or group.
ans: t pts: 1 dif: easy obj: lo: 1-1
nat: busprog: reflective thinking sta: disc: financial markets and interest rates key:
bloom's: knowledge
2. your average propensity to consume is the percentage of each dollar of income, on the average, that
is spent for current needs rather than savings.
ans: t pts: 1 dif: easy obj: lo: 1-1
nat: busprog: reflective thinking sta: disc: financial markets and interest rates key:
bloom's: knowledge
3. a good financial plan completed when one is in their 30s will typically last a lifetime.
ans: f pts: 1 dif: challenging obj: lo: 1-2
nat: busprog: reflective thinking sta: disc: financial markets and interest rates key:
bloom's: synthesis
4. financial planning is a continuing, life-long process.
ans: t pts: 1 dif: easy obj: lo: 1-2
nat: busprog: reflective thinking sta: disc: financial markets and interest rates key:
bloom's: comprehension
5. financial planning can improve your standard of living.
ans: t pts: 1 dif: easy obj: lo: 1-1
nat: busprog: reflective thinking sta: disc: financial markets and interest rates key:
bloom's: comprehension
6. current consumption is inversely related to saving for the future.
ans: t pts: 1 dif: challenging obj: lo: 1-1
nat: busprog: reflective thinking sta: disc: financial markets and interest rates key:
bloom's: analysis
7. about 20% of americans say retirement planning is their most pressing financial concern.
, ans: f pts: 1 dif: moderate obj: lo: 1-1
nat: busprog: reflective thinking sta: disc: financial markets and interest rates key:
bloom's: knowledge
8. the most effective way to achieve financial objectives is through financial planning.
ans: t pts: 1 dif: moderate obj: lo: 1-1
nat: busprog: reflective thinking sta: disc: financial markets and interest rates key:
bloom's: comprehension
9. defining financial goals is an important first step in personal financial planning process.
ans: t pts: 1 dif: easy obj: lo: 1-2
nat: busprog: reflective thinking sta: disc: financial markets and interest rates key:
bloom's: comprehension
10. two persons with equal average propensities to consume will not necessarily have equal standards
of living because of differences in income.
ans: t pts: 1 dif: challenging obj: lo: 1-1
nat: busprog: reflective thinking sta: disc: financial markets and interest rates key:
bloom's: evaluation
11. the need for financial planning declines as your income increases.
ans: f pts: 1 dif: moderate obj: lo: 1-1
nat: busprog: reflective thinking sta: disc: financial markets and interest rates key:
bloom's: synthesis
12. current consumption effects future consumption.
ans: t pts: 1 dif: challenging obj: lo: 1-1
nat: busprog: reflective thinking sta: disc: financial markets and interest rates key:
bloom's: analysis
13. a person who has $2,000 monthly income and spends $1,800 monthly has an average propensity
to consume of 90%.
ans: t pts: 1 dif: challenging obj: lo: 1-1
nat: busprog: reflective thinking sta: disc: financial markets and interest rates key:
bloom's: evaluation
14. a person making $35,000 and spending $30,800 has an average propensity to consume of 80%.
ans: f pts: 1 dif: challenging obj: lo: 1-1
nat: busprog: reflective thinking sta: disc: financial markets and interest rates key:
bloom's: evaluation
15. most families find it difficult to discuss money matters.
ans: t pts: 1 dif: easy obj: lo: 1-2
edition by randy billingsley, lawrence gitman,
michael joehnkall chapters 1-15| latest 2025 a+
, table of contents
part i: foundations of financial planning.
1. understanding the financial planning process.
2. developing your financial statements and plans.
3. preparing your taxes.
part ii: managing basic assets.
4. managing your cash and savings.
5. making automobile and housing decisions.
part iii: managing credit.
6. using credit.
7. using consumer loans.
part iv: managing insurance needs.
8. insuring your life.
9. insuring your health.
10. protecting your property.
part v: managing investments.
11. investment planning.
12. investing in stocks and bonds.
13. investing in mutual funds and real estate.
part vi: retirement and estate planning.
14. planning for retirement.
15. preserving your estate.
,chapter 1—understanding the financial planning process
true/false
1. standard of living is defined as the necessities, comforts, and luxuries desired by an individual or group.
ans: t pts: 1 dif: easy obj: lo: 1-1
nat: busprog: reflective thinking sta: disc: financial markets and interest rates key:
bloom's: knowledge
2. your average propensity to consume is the percentage of each dollar of income, on the average, that
is spent for current needs rather than savings.
ans: t pts: 1 dif: easy obj: lo: 1-1
nat: busprog: reflective thinking sta: disc: financial markets and interest rates key:
bloom's: knowledge
3. a good financial plan completed when one is in their 30s will typically last a lifetime.
ans: f pts: 1 dif: challenging obj: lo: 1-2
nat: busprog: reflective thinking sta: disc: financial markets and interest rates key:
bloom's: synthesis
4. financial planning is a continuing, life-long process.
ans: t pts: 1 dif: easy obj: lo: 1-2
nat: busprog: reflective thinking sta: disc: financial markets and interest rates key:
bloom's: comprehension
5. financial planning can improve your standard of living.
ans: t pts: 1 dif: easy obj: lo: 1-1
nat: busprog: reflective thinking sta: disc: financial markets and interest rates key:
bloom's: comprehension
6. current consumption is inversely related to saving for the future.
ans: t pts: 1 dif: challenging obj: lo: 1-1
nat: busprog: reflective thinking sta: disc: financial markets and interest rates key:
bloom's: analysis
7. about 20% of americans say retirement planning is their most pressing financial concern.
, ans: f pts: 1 dif: moderate obj: lo: 1-1
nat: busprog: reflective thinking sta: disc: financial markets and interest rates key:
bloom's: knowledge
8. the most effective way to achieve financial objectives is through financial planning.
ans: t pts: 1 dif: moderate obj: lo: 1-1
nat: busprog: reflective thinking sta: disc: financial markets and interest rates key:
bloom's: comprehension
9. defining financial goals is an important first step in personal financial planning process.
ans: t pts: 1 dif: easy obj: lo: 1-2
nat: busprog: reflective thinking sta: disc: financial markets and interest rates key:
bloom's: comprehension
10. two persons with equal average propensities to consume will not necessarily have equal standards
of living because of differences in income.
ans: t pts: 1 dif: challenging obj: lo: 1-1
nat: busprog: reflective thinking sta: disc: financial markets and interest rates key:
bloom's: evaluation
11. the need for financial planning declines as your income increases.
ans: f pts: 1 dif: moderate obj: lo: 1-1
nat: busprog: reflective thinking sta: disc: financial markets and interest rates key:
bloom's: synthesis
12. current consumption effects future consumption.
ans: t pts: 1 dif: challenging obj: lo: 1-1
nat: busprog: reflective thinking sta: disc: financial markets and interest rates key:
bloom's: analysis
13. a person who has $2,000 monthly income and spends $1,800 monthly has an average propensity
to consume of 90%.
ans: t pts: 1 dif: challenging obj: lo: 1-1
nat: busprog: reflective thinking sta: disc: financial markets and interest rates key:
bloom's: evaluation
14. a person making $35,000 and spending $30,800 has an average propensity to consume of 80%.
ans: f pts: 1 dif: challenging obj: lo: 1-1
nat: busprog: reflective thinking sta: disc: financial markets and interest rates key:
bloom's: evaluation
15. most families find it difficult to discuss money matters.
ans: t pts: 1 dif: easy obj: lo: 1-2
