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MONEY & FINANCIAL PLANNING W!SE Financial Literacy Practice Test Flashcards | StudBud
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MONEY & FINANCIAL PLANNING W!SE Financial Literacy Practice Test
MONEY & FINANCIAL PLANNING W!SE Financial Literacy Practice Test
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1
In a period of high unemployment, the amount of consumer spending tends to
remain stable
decrease
fluctuate a lot
increase
2
Which consideration from the list below is most important when exploring a potential career?
The number of job opportunities for employment in the field
The travel requirements for the job
The opinion of friends and relatives
The length of vacation offered to employees in that field
3
One DISADVANTAGE of receiving a gift card is that the person who received the card often
needs to spend the full amount on the card with one purchase
finds that retailers are reluctant to accept the card
forgets to carry the card when shopping
needs to pay a fee when using the card
4
Which of the following is NOT a role of the U.S. Department of the Treasury?
Collecting taxes.
Overseeing the Internal Revenue Service (IRS).
Printing U.S. currency.
Controlling the economy.
5
What is one consideration for a mortgage finance company or bank when reviewing an application for a mortgage loan?
Health record
Employment history
Age
Proof of term life insurance
6
A strategy to reduce the balance on a college loan is to
finish college later in life
apply for a second loan with a higher interest rate to repay the first loan
begin regular interest payments on the loan while in college
defer payments on the principal until full-time employment occurs
7
Money for saving and investing generally comes from
capital losses from the sale of stock
discretionary income after paying monthly expenses
inherited income
income to pay monthly expenses
8
After required deductions have been taken out of a person’s pay, the money the employee can take home is know as
gross pay
earned income
discretionary income
net pay
9
When deciding between two job offers with similar salaries, it is generally most important to consider the
reputation of the organization
size of the organization
company benefits and retirement plan
weekly work hours and number of employees
10
A person has $2,000 in a savings account that is earning 3% interest. The rate of inflation is 6%.
Their rate of interest being paid by the bank will automatically increase
Their savings are losing purchasing power
Their money has more purchasing power than when it was deposited
Their deposited money will double in value every three years
11
When selecting a student loan, all of the following criteria should be considered EXCEPT the
interest rate
location of the lender
payment terms of the loan
lending institution’s creditability
12
New coins and currency enter the economy when they are distributed to consumers and businesses by the
Federal Reserve Banks
U.S. Federal Mint
Treasurer of the U.S.
Secretary of State
13
A payday loan is generally NOT a smart financial decision and is illegal in some states because
these loans can be repaid easily
interest rates and fees are extremely high
it prevents the borrower from getting a raise
these loans lower a person’s credit score
14
Instead of waiting, a person takes a loan to get their tax refund immediately. This is a BAD idea because
it will result in a tax increase
it will result in a lower credit score
it will result in a lower net pay
it will result in a high fee
15
If a person does NOT have personal financial goals, then they will NOT be able to
think of steps to take for financial security or wellness
obtain a good paying job
use a financial planner
know when to ask for an increase in salary or job benefits
