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Question 1. (TCO 2) In order to best compare the earnings for different savings plans, one can refer to each plan's discounted present value. compounded rate of return. net present value. annual percentage yield. after-tax rate of return. Question 2. (TCO 2) Interest earnings of $2,400 from a taxable investment for a person in a 28% tax bracket would result in after-tax earnings of Question 3.3. (TCO 2) _____ can reduce taxable income. Portfolio income Tax credits Exclusions

Passive income Earned income


Question 4.4. (TCO 2) Whenever an individual takes on a personal effort and receives money, this is reported as _____ income. passive earned portfolio excluded capital gains Question 5.5. (TCO 2) George Washburn had earnings from his salary of $44,000, interest on savings of $800, a contribution to a traditional individual retirement account of $2,000, and dividends from mutual funds of $600. George's adjusted income (AGI) would be $43,400. $44,000. $45,400. $42,000. $42,800.

Question 6.6. (TCO 2) _____ can be calculated as a result of various items being subtracted from gross income, such as individual retirement account contributions and alimony payments. Adjusted gross income Taxable income Earned income


Passive income

Total exclusions

Question 7.7. (TCO 2) When filing your taxes, a set amount on which no taxes are paid is called _____.

itemized deductions

withholding

an earned tax credit

the standard deduction

capital gains

Question 8.8. (TCO 2) Taxes owed can be reduced through _____.

the standard deduction


a tax credit

an itemized deduction

an exclusion

an exemption

Question 9.9. (TCO 2) _____ would qualify a person for an exemption when computing taxable income.

Mortgage interest

A tax shelter

A dependent

Charitable contributions

Passive income


Question 10.10. (TCO 2) Generally, the way most people pay federal income tax is by

paying the total amount owed by April 15.

filing quarterly tax payments.

having amounts withheld from income.

earning tax credits for various deductions.

Question 11.11. (TCO 2) If you expect interest rates will decline over the next few months, you should use a(n) _____ to maximize your earnings.

regular savings account

interest-bearing checking account

5-year certificate of deposit


6-month certificate of deposit

money market fund

Question 12.12. (TCO 2) An example of a _____ deposit is a checking account.

common

time

current

loan

demand

Question 13.13. (TCO 2) When profits are generated by a mutual savings bank, they will go to the


creditors.

loan applicants.

stockholders.

depositors.

community in which it operates.

Question 14.14. (TCO 2) _____ are the major products offered by investment companies.

Interest-bearing checking accounts

Variable-rate loans

Credit card accounts

Savings bonds


Mutual funds

Question 15.15. (TCO 2) One of the characteristics of a certificate of deposit is that it can have

high interest-rate risk.

low safety for savers.

limited liquidity.

a variable rate of return.

no minimum deposit amount.

Busn 380 week 2 quiz set 2  
Busn 380 week 2 quiz set 2  
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