QUESTION: 77

Calculating certain financial ratios can help you evaluate your financial performance over time. What's more, if you apply for a loan, the lender probably will look at the ratios to judge your ability to carry additional debt. Four important money management ratios are all of the following Except:

Solvency ratio
Liquidity ratio
Savings account ratio
Debt service ratio

Answer(s): C

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QUESTION: 78

The amount of liquid funds will vary with your personal circumstances and comfort level. Another useful liquidity guideline is to have a reserve fund equal to:

3 to 6 months of income
3 to 6 months of after tax income
4 to 8 months of after tax income
6 to 12 months of income

Answer(s): B

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QUESTION: 79

Even if, the annual balances, in certain months’ expenses may exceed income, causing a monthly budget deficit. Likewise, a surplus occurs when income in some months exceed expenses. It remedy may be:

Shift expenses from months which budget, deficits to months with surpluses for, (or alternatively, transfer income, if possible, from months with surpluses to those with deficit)
Use savings, investments, or borrowing to cover temporary deficits
Estimate genuine expenses
Pay off your credit card

Answer(s): A,B

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QUESTION: 80

It is the value today of an amount to be received in future; it is the amount that would have to be invested today at a given interest rate over a specified period of time to accumulate the future amount. What is it?

Present value
Discounted value
Compounded value
Lump-sum value

Answer(s): A

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