1.(TCO C) _____ is not a liquid asset.

(Points:4)

A bond mutual fund

An interest-paying checking account
A passbook savings account
A checking account
A money market mutual fund

2.(TCOC)Higherinterestratesoncertificatesofdepositareassociatedwith(Points:4)

higheraccountbalances.
shortermaturities.
longermaturities.
AandB

AandC

3.(TCO C) Advantages of buying a used car rather than a new car include(Points:4)

good mechanical condition.

the fact that it will depreciate more quickly.
the fact that there are more choices available.
the fact that it's less expensive.
All of the above
4.(TCO C) Jackie is in the 28% marginal tax bracket and has no other itemized deductions
except those related to her home. If her standard deduction is $4,750 and she incurs the
following costs related to housing, how much tax savings will she receive as a result of her home
purchase?

Mortgage interest $14,000 Deductible in full

Principal repayment $800 not deductible
Homeowner's insurance $1,000 not deductible
Real estate taxes $4,000 Deductible in full
Homeowner's association fees $1,200 not deductible

(Points:4)
$13,250
$5,040
$3,710 Mortgage interest $14,000
$2,800 Real Estate Taxes $4,000
None Total Deductions $18,000
Minus Standard Deductions - $4,750
Totalcombineddeductions$13,250
TimesMarginaltaxbracket$13,250X.28=$3,750

5.(TCO C) If you purchase a $110,000 home and make a 10% down payment, how much
would one point cost at closing?(Points:4)
$765
$990
$1,100
$1,530
$1,800
Calculations:

$110,000x.10=11,000
$110,00011,000=$99,000
Onepoint:
$99,000x.01=$990