The best way to make an informed career decision is by:

Develop goals and research different career opportunities

Which is a true statement about the relationships between time, interest, and investment value?

a.More time and higherinterest = higher investment value.

Which of the following deductions often from paychecks are mandatory?

Federalincome tax, State Income Tax, Soc Security, Medicare

What is a true statement about paying only the minimum payment of a credit card balance?

Itwill cause the final cost higher than the initial amount

What does the statement “pay yourself first” mean?

Setaside a predetermined amount of $ before budgeting

What is not true about property taxes?

All are assessed the same regardless of the location

Which is a truestatement about saving and investing?

Savings are secure, investments are for long term goals

What is the first step in developing a spending plan?

Track current income and expenses

What is the main benefit of insurance?

Provides financial security and peace of mind

Why is a depository Institution better than keeping money under your mattress?

Your $ is insuredup to $250,000 per depositor/account type.

What is the best way to improve your financial well being?

Take a personal finance class to learn how to managemoney

What does it mean if you have a net gain on your income and expense statement?

You are earning more than you're spending & should save more

What is renters insurance for?

Tenants to cover their belongings

If an employer pays you in cash, you must:

Pay federal and state income taxes on your own

What is true about borrowing money?

Borrowingis using future income

Why is it important to “invest in yourself”?

Highereducation tends to increase earning potential

What is the difference between open ended and close ended credit?

Closeended has equal installments

What is true about a diversified portfolio?

Itdecreases the risk of your investment

Whatis an example of the consequences of a trade off?

Use savings to buy sneakers then not have $ for emergency

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Financial Literacy FINAL

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Questions 31

Answers

1
How can you increase your net worth?
Decrease your assets
Increase your liabilities
Increase your assets
Decrease the market value of your car
2
If you borrow money to purchase a car and end up owing more than the car is worth, it is called
Leasing
Hidden costs
Being upside down on the loan
Depreciation
3
The best way to make an informed career decision is by:
Choosing a career based on when your friends are doing
Choosing a career based on salary alone
Develop goals and research different career opportunities
Choose only a profession that requires a college degree
4
What is a non-contractual expense?
Food, cell phone bill
Internet bill, clothing
Gasoline, entertainment
Cell phone bill, car payment
5
By continuing your education you are investing in your:
Family
Income
Human Capital
Interest inventory
6
Which is a true statement about the relationships between time, interest, and investment value?
a.Less time and higherinterest = lower investment value
Interestis the only factor that effects investment value
Moretime and lower interest = higher investment value
a.More time and higherinterest = higher investment value.
7
If you want to save $500 for emergencies, giving up eating at restaurants is called:
interest
Opportunity cost
trade-off
smart
8
Which of the following deductions often from paychecks are mandatory?
SocialSecurity, Workers Compensation, Medicare
SocialSecurity, Life Insurance, health Insurance
A.Federal Income tax,State Income tax, Life insurance
Federalincome tax, State Income Tax, Soc Security, Medicare
9
What is a true statement about paying only the minimum payment of a credit card balance?
Itwill be paid off In a reasonable amount of time
Itwill cause the final cost higher than the initial amount
Itwill allow you to pay interest charges
Itwill save you money because you are paying less each month
10
What does the statement “pay yourself first” mean?
Savewhatever is left over at the end of the month
Setaside a predetermined amount of $ before budgeting
Youare more important than other people
Youshould pay for your desired expenses first
11
What is not true about property taxes?
Property taxes are paid on automobiles
Paid once or twice per year
All are assessed the same regardless of the location
State property taxes help fund secondary schools
12
What will NOT make you vulnerable to identity theft?
Paying bills from your phone
Paying cash for groceries
Throwing away a credit card offer
Responding to an email from your bank
13
Which is a truestatement about saving and investing?
Savings are secure, investments are for long term goals
Savingsare optional and investments are necessary
A.Savings are lessliquid than investments
Bothhelp an individual maintain a current standard of living
14
What is the first step in developing a spending plan?
Track current income and expenses
Decide on categories for your spending plan
Decide how much $$ you can spend in each category
Develop a control system
15
What is the main benefit of insurance?
You will gain money in case of an emergency
Provides financial security and peace of mind
You can get hurt more
There are no benefits
16
Which of the following savings tools is most liquid?
All of the above
Certificate ofdeposit
Checking account
Savings account
17
Why is a depository Institution better than keeping money under your mattress?
Your $ is insuredup to $250,000 per depositor/account type.
A.You get fresh billsevery time to withdraw money.
Your $ is insured up to $100,000 per depositor/account type
Itwont get bed bugs
18
What is the best way to improve your financial well being?
Borrow from your friends.
Ask your parents
Opena lot of credit card accounts
Take a personal finance class to learn how to managemoney
19
What does it mean if you have a net gain on your income and expense statement?
You are spending more than you're earning & need another job
You are earning more than you're spending & should spend mor
You are earning more than you're spending & should save more
You are spending more than you are earning
20
A low credit score will most likely mean:
Monthlypayments will be lower
Interest rate willnot be effected
Interest rate will belower
Interestrate will be higher
21
What is renters insurance for?
leased vehicles
Tenants to cover their belongings
Landlords to cover their rental properties
Seniors living with their grown children
22
If an employer pays you in cash, you must:
Say no thank you because this is illegal
Pay federal and state income taxes on your own
Say thank you
Do nothing because you didn't earn enough to pay taxes
23
The best way to accomplish a goal is:
Tell your friends about it
Think a lot about it
Tell your teacher about it
Write it down
24
What is true about borrowing money?
Borrowingis an important of a financial plan
Borrowingis using future income
Borrowing onlyaffects your present self.
Borrowingis a necessary part of life
25
The primary users of Medicare are:
single parents
unemployed adults
low income families
retired adults
26
Why is it important to “invest in yourself”?
Higher education isthe only way to have a good career.
Saving Money is agood thing.
Tolower your standard of living
Highereducation tends to increase earning potential
27
Gym memberships, flexible hours, childcare, repayment of educational loans, paid sick leave
Employee benefits
Good things
Competitive hiring practices
Job perks
28
What is the difference between open ended and close ended credit?
Interest rates aredifferent
Theyare basically the same
Creditlimits are different
Closeended has equal installments
29
What is true about a diversified portfolio?
Increases risk/returnratio
Itdecreases the risk of your investment
Limitsinvestors choices
It increases thereturn but also increases risk
30
What is one way to start building positive credit?
Filea credit report
Reapplymultiple times for the same loan
Obtainmultiple credit cards
Obtaina secure credit card
31
Whatis an example of the consequences of a trade off?
Shop at discount stores to find best price
Choosing an expensive pair of sneakers for comfort
Use savings to buy sneakers then not have $ for emergency
Purchasing sneakers online for 25% off

Financial Literacy FINAL Flashcards | StudBud