Personal Finance Chapter 5

Question 1The total estimated student loan debt outstanding (unpaid) is over:a. $1 trillionb. $10 thousandC. $7 trilliond. $1 billion Answer: $1 trillion
Question 2Which of the following is not a good option when it comes to paying for your education?a. Plan aheadb. Fill out the FAFSA c. Ask your parents to take out a loand. Get a part-time job Answer: Ask your parents for a loan
Question 3Which of the following are ways that you can invest in yourself?a. Find a mentorb. Surround yourself with people who have similar goals and ambitions as youc. Read booksd. All of the above Answer: All of the above
Question 4Which of the following statements is false?a. Millions of people canʹt afford to make their student loan payment every month.b. Our culture accepts student loan debt as normal and sometimes even refers to it as gooddebt.c. Debt is owing anything to anyone for any reason. d. A student loan is an award. Answer: A student loan is an award.
Question 5Which of the following statements about college financial aid is false?a. Many businesses have scholarships for employeesʹ children. b. Grants are free money.c. The Free Application for Federal Student Aid (FAFSA) is the first step to receiving any kindof financial aid.d. Scholarships are only for the highest academic achievers. Answer: Scholarships are only for the highest academic achievers.
Question 6You should visit your collegeʹs financial aid office if:a. Your parentsʹ financial situation has changedb. You have any problems with the financial aid application processc. A medical situation has come up d. All of the above Answer: All of the above
Question 7Which of the following statements is false?a. On-campus jobs may pay you directly or pay toward your tuition bill.b. Research shows that students who work up to 20 hours a week have the highest GPAsc. Research shows that working more than 20 hours a week may affect your gradesnegatively.d. Students rarely drop out of college due to financial trouble. Answer: Students rarely drop out of college due to financial trouble.
Question 8Which of the following is not recommended when you are cash-flowing your college education?a. Live on a zero-based budget. b. Attend an out-of-state school.c. Work and save money over the summer months.d. Make sure you have an emergency fund. Answer: Attend an out-of-state school
Question 9The average repayment period for a student loan is:a. 15 yearsb. 5 yearsc. 20 yearsd. 10 years Answer: 10 years
Question 10Which of the following statements is false?a. On-the-job training often combines a professional trainer, hands-on activities and formalclassroom training.b. Students who are looking to learn specific skills can look into free or low-cost certificationsfound online, at community colleges, or through government-funded programs.c. An associateʹs degree is a two-year degree that can offer specialized training and a flexibleschedule that allows you to work while you earn your degree.d. All high-paying careers require a four-year college degree. Answer: All high-paying careers require four-year colllege degree
Question 11The Fourth Foundation is:a. Pay cash for your carb. Build wealth and givec. Build a $500 emergency fundd. Pay cash for college Answer: Pay cash for college
Question 12Which of the following could be a negative consequence of taking out student loans?a. Not having the freedom to be a stay-at-home parent because of student loan paymentsb. Having to delay investing and saving for your future because of student loan paymentsc. Not having flexibility in your career options because of student loan paymentsd. All of the above Answer: All of the above
Question 13Percentage of college students that graduate with student loans:a. 90% b. 66%c. 30%d. 25% Answer: 66%
Question 14A wise college plan does not include:a. Creating a budget and starting to save nowb. Shopping around for the most appropriate, low-cost academic option for your career choicec. Scoring well on the ACT or SAT d. Finding the most expensive, prestigious college so that you can impress future employers Answer: Finding the most expensive, prestigious college so that you can impress future employers
Question 15Which of the following is not one of the basics of budgeting?a. Pay yourself first by savingb. Stick to your budget unless something unexpected happensc. Make it a priority to gived. Live on less than you make Answer: Stick to your budget unless something unexpected happens
Question 16Our culture thinks student loan debt is normal and that itʹs an acceptable way to pay for college.TrueFalse Answer: True
Question 17A four-year degree is necessary regardless of which career youʹre entering.TrueFalse Answer: False
Question 18The average millionaire reads one nonfiction book a month.TrueFalse Answer: True
Question 19When shopping for the best education option, you should narrow down your choice of colleges to 10 schools or less.TrueFalse Answer: False
Question 20The best quality colleges are always the most expensive.TrueFalse Answer: False
Question 21You must go to a prestigious school in order for employers to recognize your talents andstrengths.TrueFalse Answer: False
Question 22If you plan to attend a community college for your first two years, youʹll want to work closelywith your advisor to make sure that the classes you take will transfer to your four-year school ofchoice.TrueFalse Answer: True
Question 23You must shop for the best price for your education, in the same way, you comparison shop for any large purchase.TrueFalse Answer: True
Question 24Youʹll only need to complete the FAFSA once during your college education.TrueFalse Answer: False
Question 25The academic and financial choices you make in the next few years will affect the next 40 years of your life.TrueFalse Answer: True
A form that is completed annually by current and prospective college students to determine their eligibility for financial aid : FAFSA
A form of financial aid that does not need to be repaid; usually awarded on the basis of academic, athletic or other achievements: Scholarship
A program that allows students to work part-time while continuing their studies: Work study
A form of federal or state financial aid that does not need to be repaid; usually given to students who demonstrate financial need: Grant
A two-year government-supported college that offers an associateʹs degree: Community college
Usually a professional trainer serves as the course instructor and uses a combination of hands-on activities and formal classroom training: On-the-job-training
Allows students to learn basic professional skills in two years or less; typically cut out many of the general courses required by traditional universities: Trade school
These may be free or low-cost; found online, at community colleges, or through government-funded programs: Certifications
A person that starts his or her own business: Entrepreneur
Pay as you go: Cash-flow

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