TEST BANK FOR Introduction to Personal Finance Beginning Your Financial Journey, 2nd Edition John E. Grable, Lance Palmer Chapter 1-10

TEST BANK FOR
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Introduction to Personal Finance Beginning Your Financial Journey, 2nd Edition J
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ohn E. Grable, Lance Palmer
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Chapterw1-10

Chapterw1 BeginningwYourwFinancialwJourney:wThewInteriorwFinancewPointwofwView

1) wWhichwofwthewfollowingwreferswtowone'swabilitywtowunderstandwandwusewpersonalwfinan
cewinformation?
A) Financialwriskwtolerance.
B) Financialwwell-being.
C) Financialwknowledge.
D) Financialwability.
wAnswer:w C

Explanation:w Financialwknowledgewiswthewabilitywtowunderstandwpersonalwfinancewinformation.wKnow
ingwwhowyouware,wwherewyouwwantwtowgo,wandwwhatwskillswyouwcurrentlywpossesswarewessentialwfactorsws
hapingwyourwfinancialwjourney.
Diff:w1
LO:w 1.1,wSectionw1.1
wBloom: w K

AACSBw/wIMA:w none;wnonew
AICPA:w FC:wnone
Min:w w 1

2) Peoplewwhowbelievewthatwwhatwhappenswtowthemwiswbasedwonwfateworwluckwmightwviewwtheirwfinanci
alwjourneywaswbeingwuncertain.wThiswiswanwexamplewof
A) financialwriskwtolerance.
B) financialwliteracy.
C) feelingswofwcontrol.
D) financialwability.
wAnswer:w C

Explanation:w Feelingswofwcontrolwiswthewamountwofwcontrolwyouwfeelwyouwhavewwhenwmakingwfina
ncialwdecisions.wPeoplewwhowbelievewthatwwhatwhappenswtowthemwiswbasedwonwluckworwfatewmightwvi
ewwtheirwfinancialwjourneywaswuncertain.
Diff:w1
LO:w 1.1,wSectionw1.1
wBloom: w C

AACSBw/wIMA:w none;wnonew
AICPA:w FC:wnone
Min:w w 1




1

,3) Internalwfinancewincludeswyour
A) financialwknowledge.
B) financialwriskwtolerance.
C) feelingswofwcontrol.
D) Allwofwthewchoiceswarewcorrect
.wAnswer:w D
Explanation:w Internalwfinancewiswessentiallywthewcombinationwofwfinancialwknowledge,wfinancialwr
iskwtolerance,wandwfeelingswofwcontrol.
Diff:w1
LO:w 1.1,wSectionw1.1
wBloom: w K

AACSBw/wIMA:w none;wnonew
AICPA:w FC:wnone
Min:w w 1

4) Whichwofwthewfollowingwreferswtowyourwconfidencewandwpeacewofwmindwregardingwyourwfinanci
alwsituation?
A) Financialwliteracy.
B) Financialwwell-being.
C) Financialwknowledge.
D) Financialwability.
wAnswer:w B

Explanation:w Financialwwell-
beingwiswyourwconfidencewandwpeacewofwmindwregardingwyourwfinancialwsituation.wYourwfinancialww
ell-
beingwwillwincreasewaswyouwapplywyourwfinancialwknowledge,wdevelopwskills,wandworganizewyourwfin
anceswtowachievewyourwpersonalwgoals.
Diff:w2
LO:w 1.1,wSectionw1.1w
Bloom:w C
AACSBw/wIMA:w none;wnonew
AICPA:w FC:wnone
Min:w w 1

5) Inwadditionwtowfinancialwknowledge,wwhichwofwthewfollowingwiswimportantwinwshapingwyourwvieww
ofwthewfinancialwworld?
A) Financialwriskwtolerance,wonly.
B) Feelingswofwcontrol,wonly.
C) Financialwwell-beingwonly.
D) Financialwriskwtolerancewandwfeelingswofwcontrol
.wAnswer:w D
Explanation:w Ourwfinancialwdecisionswcanwbewbasedwonwawbiasedwviewwofwthewfinancialwworld,wwhi
chwiswbasedwonwthewcombinationwofwourwfinancialwknowledge,wfinancialwriskwtolerance,wandwfeeling
swofwwcontrol.
Diff:w2
LO:w 1.1,wSectionw1.1
wBloom: w C

AACSBw/wIMA:w none;wnonew
2

,AICPA:w FC:wnone
Min:w w 1




3

, 6) Whichwofwthewfollowingwreferswtowyourwwillingnesswtowengagewinwfinancialwendeavorswthatwha
vewuncertainwoutcomes?
A) Financialwliteracy.
B) Financialwriskwtolerance.
C) Financialwknowledge.
D) Financialwability.
wAnswer:w B

Explanation:w Yourwfinancialwriskwtolerancewiswyourwwillingnesswtowengagewinwfinancialwendeavors
wthatwhavewuncertain woutcomes.

Diff:w1
LO:w 1.1,wSectionw1.1
wBloom: w K

AACSBw/wIMA:w none;wnonew
AICPA:w FC:wnone
Min:w w 1

7) WhichwofwthewfollowingwiswmeasuredwbywaddingwupwhowwmuchwthewUnitedwStateswproducesw
inwgoodswandwserviceswinwawyear?
A) Grosswdomesticwproduct.
B) Thewcostwofwgoodswsold.
C) Financialwliteracy.
D) Financialwriskwtolerance.
wAnswer:w A

Explanation:w Grosswdomesticwproductw(GDP)wiswmeasuredwbywaddingwupwhowwmuchwawcountrywprodu
ceswinwgoodswandwserviceswinwawyear.
Diff:w1
LO:w 1.1,wSectionw1.1
wBloom: w K

AACSBw/wIMA:w none;wnonew
AICPA:w FC:wnone
Min:w w 1

8) HowwmuchwofwGDPwconsistswofwconsumerwspending?
A) 46%.
B) 50%.
C) 60%.
D) 66%.
Answer:w w D
Explanation:w Inw2020,wthewU.S.wGDPwwasw$19.80wtrillionwandwnearlywtwo-
thirdsw(66%)wofwGDPwconsistswofwconsumerwspending.
Diff:w1
LO:w 1.1,wSectionw1.1
wBloom: w K

AACSBw/wIMA:w none;wnonew
AICPA:w FC:wnone
Min:w w 1

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