Topics for Personal Investment & Finance Final Exam
Below is a list of the topics that could be included on your final exam. The exam will consist of T/F
questions and multiple choice questions (including some calculations). Reviewing your notes,
handouts, and assignments will greatly help you.
Chapter 1 –Understanding the Financial
Planning Process
Short-term, intermediate, and long-term
goals
Financial planning process
Average propensity to consume
Wealth, utility, standard of living
Economic cycle
Time value of money, present value, and
future value
Simple vs compound interest
Chapter 2 – Developing Your Financial
Statements and Plans
Keeping financial records
Certified financial planner
Liquidity ratio
Balance sheet, income statement, and
budgets
Chapter 3 – Preparing Your Taxes
Taxation philosophies
Difference among taxes
Tax avoidance vs. tax evasion
Tax rate methods
Types of taxes
Credits vs deductions
Filing status and tax forms
Chapter 4 – Managing Your Cash and
Savings
Cash management steps
Four types of financial institutions
Three types of savings bonds
Chapter 5 – Making Automobile and
Housing Decisions
Renting an apartment vs buying a home
Steps and finances when buying a home
Selling a home
Buying vs. leasing vehicles
Factors to consider
Depreciation
Chapter 6 – Using Credit
Pros and cons of using credit
Rule of thumb
Debt-safety ratio
Types of cards (credit and debit)
Interest rate and annual percentage rate
FICO
Applying for credit process
Chapters 8-10 – Insuring Your Life, Health,
and Property
Insurance
Premiums
Ways people deal with risk
Deductible
Four steps in the insurance management
process
Property insurance
Liability insurance
Personal auto policy
HMO
PPO
POS
Life Insurance
Beneficiary
Annuity
Term life insurance
Whole life insurance
Universal insurance
Chapters 11-13 – Investment Planning
Purpose of investing
Preparing to invest
Four steps in investing
Asset allocation
Types of investments