Chapter 2 Test A

Chapter 2 Test A - Chapter 2 Test A 1 The three parts of...

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1 Chapter 2 Test A 1. The three parts of your balance sheet are a. income, liabilities, balance b. assets, expenditures, balance c. assets, liabilities, balance d. assets, liabilities, net worth e. income, liabilities, net worth 2. Sam and his wife Ann purchased a home in Lubbock, Texas in 1980 for $100,000. Their original home mortgage was for $90,000. The house has a current market value of $175,000 and a replacement value of $200,000. They still owe $55,000 on their home mortgage. Sam and Sally are now constructing their balance sheet. How should their home be reflected on their current personal balance sheet? a. $200,000 asset and $55,000 liability b. $200,000 asset and $90,000 liability c. $175,000 asset and $55,000 liability d. $175,000 asset and $90,000 liability e. $100,000 asset and $55,000 liability 3. Jacque's total monthly loan payments are $1,020 while her gross income is $3,000 per month. What is her debt service ratio? a. 34% b. 43% c. 50% d. 75% e. 82% 4. To determine how effectively the budget is working, you can use a. the balance sheet. b. the income statement. c. income and expenditure records. d. year-end financial statements. e. financial goals. 5. Michael and Sandy purchased a home for $100,000 five years ago. If it appreciated 6% annually, what is it worth today? a.
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This note was uploaded on 03/15/2011 for the course ECON 201 taught by Professor Sung during the Spring '08 term at Indiana.

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Chapter 2 Test A - Chapter 2 Test A 1 The three parts of...

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