Which should you use when creating a budget - your NET PAY or GROSS PAY?

Net pay, because it’s theamount you’ve earned minus taxes and deductions

Which description of the difference between saving and investing is MOST accurate?

Savings accounts provide a stated rate of return that is less risky.

Comparison shopping is the practice of…

Comparing the same product offered by different retailers

Which of the following is a method of accessing the money in your checking account?

Use your debit card at a store-sign the electronic machine or paper receipt

What does it mean when Marbella's aunt says, “Be sure to pay yourself first!”?

She should save part of her paycheck before she buys anything else.

Which of these options depicts the types of financial aid from MOST attractive to LEAST attractive?

Federal loans, Grants/Scholarships, Work-study, Private loans

Select the statement below that accurately describes a characteristic of a credit card.

Making full payments every month is the only way to avoid interest charges

Each of the following is a way to access money in your checking account EXCEPT…

Swipe a prepaid card to pay for your fast food purchase

What is the purpose of setting up and putting money into an emergency fund?

You use that money in case an unexpected expense comes up that you must pay

Which of the following explanations might help Sylvester understand loan jargon?

INTEREST RATE is how much the lender charges per year for the loan

Which action would INCREASE the money in Shirley’s checking account?

She uses her smartphone to deposit a check from her grandpa.

Which of these financing options will likely lead to the LOWEST MONTHLY payment for a $30,000 car?

$3000 down payment, 6% interest, 84 months

Which of these is an example of comparison shopping?

Researching which online store has the best price on a tent

What can Boone do when he is online to protect himself from identity theft?

Conduct banking or online shopping on a secure Wi-Fi network.

Which of the statements below is correct regarding Isaiah's summer job salary?

His gross pay is $3,000 and net pay is $2,500.

Which of the following would help explain why Anna's take-home pay is less than expected?

Taxes, social security, and Medicare are being deducted from her pay

How does simple interest differ from compound interest?

compound interest is calculated on the principal and interest

Typically, when should you first file the FAFSA?

October or November of your last year of high school

If you are trying to get a loan to pay for a used car, what type of interest rate should you be looking for?

You want a low interest rate so the total you pay is less.

Which statement best describes NEEDS vs WANTS?

NEEDS are required expenses you cannot avoid, while WANTS are optional

Who is taking a smart step towards protecting themselves from identity theft?

Tom, who checks his bank statement monthly to verify accurate transactions

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Financial Literacy Quiz

33 termsStudBud Administration134 plays

Test your knowledge on personal finance with questions about budgeting, loans, investments, and financial aid.

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Questions 33

Answers

1
Which should you use when creating a budget - your NET PAY or GROSS PAY?
Net pay, because it’s what is reported to the government for tax purposes
Gross pay, because it’s the total amount you’ve earned that month
Gross pay- it’s the total amount you’ve earned minus any bills you owe
Net pay, because it’s theamount you’ve earned minus taxes and deductions
2
Which description of the difference between saving and investing is MOST accurate?
Savings accounts provide a stated rate of return that is less risky.
Less than $10,000 is saving. More is investing
Saving and investing are the exact same thing
Investing is best for the short-term and for emergencies
3
In order to qualify for financial aid, prospective college students must submit their _______.
Parent’s credit score
Financial aid letter
PSAT, SAT, or ACT scores
FAFSA
4
Comparison shopping is the practice of…
Comparing the prices of two unrelated products you need to purchase
Comparing a product you bought a year ago to a version available now
Compare quality of a product to the quality of a product a friend bought
Comparing the same product offered by different retailers
5
When a bank says their savings account earns 1% interest, that means you will earn 1% interest over what period of time?
Daily
Monthly
Annually
Quarterly
6
50/30/20 rule categories, in order:
Needs, wants, savings
Wants, needs, savings
Savings, needs, wants
Needs, savings, wants
7
Which of the following is a method of accessing the money in your checking account?
Deposit a paycheck from your job
Buy a prepaid card using cash
Use your debit card at a store-sign the electronic machine or paper receipt
Take money from the ATM using your credit card
8
What does it mean when Marbella's aunt says, “Be sure to pay yourself first!”?
She should pick up her check first thing in the morning when banks open
Marbella should ask her boss for a raise, so that her paycheck is higher.
She should save part of her paycheck before she buys anything else.
make sure she buys everything SHE needs before shopping for others.
9
What tool would you encourage Lana to use to create a better plan for her money?
A credit card
A budget
A checking account
An insurance policy
10
What would be the MOST common deduction from your paycheck if you have a part-time job as a high school student?
Insurance premiums
Taxes
Retirement savings
You would be too young for deductions
11
Which of these options depicts the types of financial aid from MOST attractive to LEAST attractive?
Grants/Scholarships, Work-study, Federal loans, Private loans
Private loans, Federal loans, Work-study, Grants/Scholarships
Federal loans, Grants/Scholarships, Work-study, Private loans
Work-study, Grants/Scholarships, Federal loans, Private loans
12
What are the two main categories that will help Rita form a budget?
Credit cards and debit cards
Income and expenses
Insurance and investments
Paycheck and taxes
13
This tax form is received in January & has info on how much you earned and how much you paid in taxes for the year
1040
I-9
W-4
W-2
14
Select the statement below that accurately describes a characteristic of a credit card.
Making full payments every month is the only way to avoid interest charges
You must have money in a checking account to use the card for purchases
They do not charge interest
You owe the same payment every month
15
Each of the following is a way to access money in your checking account EXCEPT…
Write a check to pay the rent on your apartment
Swipe a prepaid card to pay for your fast food purchase
Take out cash using your debit card at an ATM machine
Use your debit card to pay for groceries at a Point-of-Sale (POS) terminal
16
What is the purpose of setting up and putting money into an emergency fund?
You invest the fund into stocks and make a profit to use for emergencies.
You use it to pay for college tuition or a major expense like a house.
You save that money to use for monthly expenses like your rent or insurance
You use that money in case an unexpected expense comes up that you must pay
17
Which of the following explanations might help Sylvester understand loan jargon?
TERM is the length of the loan, and INTEREST RATE is the total money paid
PRINCIPAL is what he owes per month, and TERM is how much he owes overall
INTEREST RATE is how much the lender charges per year for the loan
MONTHLY PAYMENT is the monthly interest cost;TERM is the name of his lender
18
Which action would INCREASE the money in Shirley’s checking account?
She uses her smartphone to deposit a check from her grandpa.
She uses a person-to-person app to pay a friend for dinner.
She uses a prepaid card to pay for a month of movie streaming.
She uses her debit card to buy a holiday gift.
19
Which type of financial aid must be paid back with interest?
Loan
Grant
Work Study
Scholarship
20
Which of these financing options will likely lead to the LOWEST MONTHLY payment for a $30,000 car?
$0 down payment, 6% interest, 60 months
$3000 down payment, 6% interest, 84 months
$3000 down payment, 6% interest, 60 months
$0 down payment, 0% interest, 36 months
21
Which of these is an example of comparison shopping?
Paying for items in cash so you don’t spend as much money
Buying all your clothes at the same discount outlet
Cutting coupons before you go grocery shopping each week
Researching which online store has the best price on a tent
22
What type of investment did Phillip purchase when he bought a share of Microsoft?
Bond
Stock
Index Fund
Mutual Fund
23
When taking out a loan, the shorter your term length, the _ your monthly payment, and the _ the total interest you pay.
higher, lower
lower, lower
higher, higher
lower, higher
24
What can Boone do when he is online to protect himself from identity theft?
Use the same password for all of his accounts
Send important personal and banking information only via email
Conduct banking or online shopping on a secure Wi-Fi network.
Share his account numbers and passwords with one trusted source
25
Which of the statements below is correct regarding Isaiah's summer job salary?
His gross pay is $3,000 and net pay is $2,500.
His gross and net pay are $2,500.
His gross pay is $2,500 and net pay is $3,000.
His gross and net pay are $3,000.
26
Which of the following would help explain why Anna's take-home pay is less than expected?
Taxes, social security, and Medicare are being deducted from her pay
Most employers charge a “payroll fee,”
Her company is downsizing and has decided to pay her less without notice
businesses typically pay high school students less than minimum wage
27
All of the following options will be deducted from Laura's paycheck EXCEPT…
Medicare
Social Security
Overdraft fees
Federal taxes
28
How does simple interest differ from compound interest?
compound interest is calculated on the principal and interest
Simple interest is low risk; compound interest is high risk
compound interest is calculated on principal alone.
Simple offers a guaranteed return; compound involves more risk
29
Typically, when should you first file the FAFSA?
October or November of your last year of high school
After you receive your Student Aid Report
Once you are ready to start repaying your student loans
After you finish freshman year of high school
30
If you are trying to get a loan to pay for a used car, what type of interest rate should you be looking for?
You want a high interest rate so the total you pay is less.
You want a low interest rate so the total you pay is less.
You want a high interest rate so you can afford a fancier car.
You want compound interest, so that the value of the car grows quickly.
31
How much does it cost to file the FAFSA?
It is free the first time you file, but costs $9.99/year thereafter
It is 2% of your total loan amount
Nothing; it is free
$50
32
Which statement best describes NEEDS vs WANTS?
NEEDS are expenses for your family, while WANTS are expenses for you.
NEEDS are expenses the government pays, while WANTS are expenses you pay
NEEDS are required expenses you cannot avoid, while WANTS are optional
NEEDS are bills you must pay, while WANTS are bills you are excited to pay.
33
Who is taking a smart step towards protecting themselves from identity theft?
Melody, who uses a website that starts with “http” instead of “https”
Tom, who checks his bank statement monthly to verify accurate transactions
Isaiah, who logs into his bank’s mobile app using public WiFi
Misha, who throws their expired credit card in the trash without shredding

Financial Literacy Quiz Flashcards | StudBud