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Financial Literacy Flashcards | StudBud
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Financial Literacy
Financial Literacy
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A comprehensive quiz on all things dealing with personal finance and financial literacy
Flashcards
42 cards
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Questions
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Answers
1
The primary goal of the Federal Reserve system is to:
Keep banks up-to-date on the latest economic research
Provide budget recommendations to the Treasury Department
Maintain a safe and stable banking system
Ensure interest rates for savings accounts stay high
2
When looking to finance higher education, what is the best order to look for funding sources?
Grants/Scholarships - Private Loans - Federal Student Loans
Federal Student Loans - Grant/Scholarships - Private Loans
Grants/Scholarships - Federal Student Loans - Private Loans
Private Loans - Grants/Scholarships - Federal Student Loans
3
Which is LEAST important to maintaining a healthy credit score?
Making on-time payments
Knowing your exact credit score
Checking your credit report annually
Alerting the credit bureaus to any false info on your report
4
Why is HIgher Education considered an Investment?
Because it fluctuates with the stock market
You will pay for tuition, but on average this will pay off
Because you need an investment firm to help pay tuition
It's not an investment, it's a trap that should be avoided!
5
Which password is the strongest?
#F@vRE4Ever!*
ARod12
G0PaCkGo
PackersRock123
6
Which of the following describes an effective strategy for protecting against identity theft?
Avoid using unsecured wireless networks
Shredding all important mail and documents
Only use trusted organizations to wire money
Keep your Social Security card in your wallet
7
In which of the following situations should you expect to provide your Social Security number?
Applying for federal student aid
Signing up for an after-school club
Registering for a store rewards card
Paying your cell phone bill
8
Which of the following insurance types will cover the possessions inside your home?
Both are correct
Renter's Insurance
Homeowner's Insurance
Neither are correct
9
A college loan in which you DO NOT have to pay the interest during college is a..
Subsidized loan
Unsubsidized loan
10
Interest rate = 4% Account = $50,000. How long would it take to get to $100,000? (Rule of 72)
12
30
18
24
11
Which of the following statements are TRUE about credit scores?
They reflect how likely individuals are to repay debts
Bad reports on your credit are cleared annually
All these answers are correct
Bad reports on your credit are cleared quarterly
12
At the minimum, how often should you check your credit score?
Once a year
Once every five years
Once every decade
Every week
13
You have $20,000 in your account that is earning compound interest. What would be best for you?
Compounding your interest annually
Compounding your interest monthly
Compounding your interest weekly
Compounding your interest semi-annually
14
Which is TRUE about credit cards?
Credit card purchases can impact your credit score
Credit card purchases come directly out of your account
You HAVE to be 21 to own a credit card
Debit card purchases have better protection then credit card
15
Which of the following will NOT affect the size of your monthly mortgage payment?
The square footage of the house
The size of your down payment
All answers are correct
The length of your mortgage
16
The FDIC insures at least ______________ per depositor at qualifying banks
$250,000
$50,000
$200,000
$300,000
17
Which of the following conditions will maximize the amount of interest you earn?
A high interest rate & short time period
A high interest rate & long time period
A low interest rate & short time period
A low interest rate & long time period
18
When making college visits, you may be able to…
Attend a college class to see what it’s like
All are correct
Schedule a tour of the college campus
Talk to your future Professor's
19
Which of the following statements about minimum payments is CORRECT?
If you only pay the minimum, you will be charged a late fee
If you only submit the minimum, you will still pay interest
Even if you have the money, you should only pay the minimum.
Minimum payments = 15-20% of your total debt
20
What is the difference between a Bear and a Bull market?
Bull market is good/optimistic. Bear market is bad/uneasy
Both mean investors are worried about the market
Both are made up animals that don't exist
Bear market is good/optimistic. Bull market is bad/uneasy
21
Would you rather have $1,000,000? Or a penny that doubles every day for a month (30 days)
The doubling penny
$1,000,000
One Million dollars
Neither, both would bankrupt you
22
What is the tax that pays for
health care
for people 65 years and older?
Medicare
401k
State Income Tax
Social Security
23
You may have been a victim of identity theft if…
Your Merchant card e-mails you to say your data was stolen
You see charges on your bank account that you dont recognize
All answers are incorrect
You see your credit report and notice unwarranted accounts
24
What financial behaviors will typically lead to a low credit score?
On-time payments
Long credit history
Fully paid balances
Maxed out credit cards
25
Which of the following statements is correct?
Cars typically gain the most value in the first year
Houses will usually appreciate in value over the long-term
Both answers are correct
Neither answers are correct
26
A car is a good example of a…
Unsubsidized Loan
Depreciating asset
Appreciating asset
Subsidized Loan
27
Which two components have the greatest impact on your credit score?
Payment History & Types of Credit Used
Amounts Owed & Payment History
New Credit & Types of Credit Used
Amounts owed & Length of credit history
28
he __________________ is the amount you are personally required to pay “out-of-pocket”
Deductible
Interest
Premium
Claim
29
All of the following are fees typically charged by credit card companies EXCEPT:
Annual membership fee
Balance transfer fee
Reload fee
Late payment fee
30
When should you start saving for your retirement?
When you hit the age of 30
When you get your first steady job after school
When you are settled in your career for 10 years
When you first get allowance as a kid
31
A 500 for your credit score is considered
Good
Excellent
Fair
Bad
32
Which will earn you more money over a period of time
Simple interest
Compound interest
33
Which phrase best describes the stock market?
High risk, high reward
High risk, low reward
Investing in oil will make your blood boil
Low risk, high reward
34
What is a possible reason a company would sell stock?
To downsize a company
All are correct
To shore up middle management
To expand its business
35
Which of the following taxes are charged on items at the time of purchase?
Income Tax
Item Tax
Sales Tax
Capital Gains Tax
36
Put simply, the definition of liquidity is:
The humidity levels of the Federal Reserve
The interest rate of a subprime loan
How much money you have in 401k investments
How quickly you can get your hands on your money
37
When you use a debit card or write a check, which bank account does that money come out of?
Checking Account
Savings Account
38
When would you use the rule of 72?
To figure out the interest rate for your savings account
To calculate a reasonable monthly savings goal
To find out how long it will take your money to double
To estimate how much money you'll have in 72 years
39
Put these in order of high liquidity to low liquidity. Savings, Checking, CD.
Checking, CD, Savings
Savings, Checking, CD
Checking, Savings, CD
Savings, CD, Checking
40
The _________________ is the amount of money you pay to the insurance company for coverage.
Interest
Claim
Premium
Primary Mortage
41
What's the difference between putting money in the stock market, compared to a savings account?
You are guaranteed more money in the stock market
Savings account is riskier than the stock market
Stock market is safer than a savings account
Stock market is riskier than a savings account
42
An 795 on your credit score is considered
Excellent
Fair
Bad
Good
