What is the break-even point for a business?

When total revenue equals total expenses

What is the difference between a need and a want?

Needs are necessary for survival, wants are desired but not essential

What does cash flow refer to in a business context?

The money moving in and out of a business over time

Which of the following best describes fiat money?

Money whose value is based on trust and government backing

What is financial literacy?

The ability to understand and effectively use financial skills

What is the main difference between gross income and net income?

Gross income is before deductions, net income is after deductions

What is a credit rating?

An indication of your creditworthiness

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Financial Literacy

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Questions 15

Answers

1
Which of the following is NOT a common trait of money?
Perishability
Portability
Divisibility
Durability
2
What is the break-even point for a business?
When profits are at their highest
When sales reach one million dollars
When total revenue equals total expenses
When the business has no debt
3
What is the difference between a need and a want?
There is no difference; they are interchangeable terms
Needs are necessary for survival, wants are desired but not essential
Needs are determined by society, wants are personal choices
Needs are always expensive, wants are always cheap
4
What does cash flow refer to in a business context?
The profit a business makes each year
The physical movement of cash in and out of a store
The money moving in and out of a business over time
The amount of cash kept in the business safe
5
What is the primary function of the Bank of Canada?
To regulate the money supply
To print all Canadian currency
To provide loans to individuals
To manage individual bank accounts
6
Which factor is LEAST likely to influence a person's values about money?
Culture
Media
Family
Weather
7
What is the primary purpose of budgeting?
To invest in the stock market
To plan and control spending
To avoid all debt
To increase your income
8
How is net income calculated?
Gross income - deductions
Gross income + deductions
Gross income × tax rate
Gross income - expenses
9
Which of the following is a potential consequence of poor financial management for a small business?
Automatic expansion
Increased profits
Bankruptcy
Guaranteed loans
10
Which of the following best describes fiat money?
Money whose value is based on trust and government backing
Currency with intrinsic value
Ancient forms of currency like shells or beads
Money backed by gold reserves
11
Which of the following is NOT typically a source of income?
Wages from a job
Credit card purchases
Interest from savings
Rental income from property
12
Which of the following is an example of a fixed cost for a business?
Sales Commissions
Raw materials
Utilities
Rent
13
What is financial literacy?
The ability to understand and effectively use financial skills
The knowledge of stock market trends
The ability to read financial documents
The skill of managing a bank
14
What is the main difference between gross income and net income?
Gross income is for businesses, net income is for individuals
Gross income is before deductions, net income is after deductions
Gross income is taxable, net income is tax-free
There is no difference; they are the same thing
15
What is a credit rating?
The interest rate on your loans
An indication of your creditworthiness
Your current credit card balance
The maximum amount you can borrow

Financial Literacy Flashcards | StudBud