7th Grade Financial Literacy

Front

What is a variable expense?

Back

A variable expense is a cost that can change from month to month, such as groceries and gas.

Front

What is the formula to calculate monthly budget allocation for miscellaneous expenses?

Back

To find the amount spent on miscellaneous expenses, you can take the total monthly income and multiply it by the percentage allocated for miscellaneous expenses.

Front

How do you calculate income tax from an annual salary?

Back

To calculate income tax, multiply the annual salary by the income tax rate (e.g., for a $40,000 salary with a 20% tax rate, the tax is $40,000 x 0.20 = $8,000).

Front

Is it important to follow a budget consistently? Why?

Back

Yes, following a budget consistently is important to control spending and meet financial needs.

Front

How do you calculate the total cost of items including sales tax?

Back

To calculate the total cost, add the prices of the items together and then multiply by (1 + sales tax rate). For example, if the total before tax is $15.70 and the sales tax is 5%, the total cost is $15.70 x 1.05 = $16.49.

Front

What are fixed expenses?

Back

Fixed expenses are costs that do not change from month to month, such as rent or mortgage payments.

Front

What is the difference between needs and wants in financial literacy?

Back

Needs are essential expenses required for survival (e.g., food, shelter), while wants are non-essential items that enhance quality of life (e.g., luxury items, entertainment).

Front

What is a budget?

Back

A budget is a plan that outlines expected income and expenses over a specific period, helping individuals manage their finances.

Front

What is the purpose of tracking expenses?

Back

Tracking expenses helps individuals understand their spending habits, identify areas for improvement, and ensure they stay within their budget.

Front

What is the significance of an emergency fund?

Back

An emergency fund is savings set aside for unexpected expenses, providing financial security and peace of mind.