Question

Which of the following statements concerning cash flow planningis correct?

The goal is to maximize net cash flow.

The goal should be to invest for the future, rather thanmaintaining current lifestyle.

The goal should be to identify strengths and weaknesses in theclient’s cash flows.

The goal is to optimize net cash flow.

2.

All the following are advantages of budgeting, EXCEPT:

It helps reveal inefficient uses of resources.

It fosters creativity and judicious risk-taking.

It provides a way of measuring progress toward goals.

It heightens awareness of and attention to the need to setfinancial goals.

3.

Robert and Jennifer are looking to refinance their $400,000mortgage. Which of the following mortgages will allow them to paythe smallest monthly payment this year if they all charge a 5%interest rate?

30-year standard mortgage

30-year biweekly mortgage

30-year balloon mortgage

30-year adjustable rate mortgage

4.

Banks will typically grant home equity loans or lines of creditup to what loan-to-value percentage?

20 percent

40 percent

60 percent

80 percent

5.

Chase, age 26, is just beginning his career as a computeranalysts after completing graduate school. He is engaged andplanning to purchase a home soon after marrying his collegesweetheart. His life stage is somewhat typical for someone in the_____ life stage.

		1
		2
		3
		4 6.

Which of the following are appropriate investments for Logan’semergency fund assets?

I Checkingaccount

II Moneymarket accounts

III Short-termcertificates of deposit

IV U.S.Treasury bills

		I and III only
		II and IV only
		II and III only
		I, II, III, and IV