Financial Literacy Test

Front

What is a budget?

Back

A plan for spending money.

Front

How do you calculate simple interest?

Back

Simple Interest = Principal x Rate x Time.

Front

What is the interest earned on a $2,000 investment at an 8% rate for 5 years?

Back

$800.

Front

What are liabilities?

Back

Bills and loans that a person owes.

Front

What is net worth?

Back

The difference between total assets and total liabilities.

Front

If a person has $8,794 in assets and $6,292 in liabilities, what is their net worth?

Back

$2,502.

Front

What is an asset?

Back

Anything of value that a person owns.

Front

What is the formula for calculating net worth?

Back

Net Worth = Total Assets - Total Liabilities.

Front

What are examples of liabilities?

Back

Mortgages, credit card debt, and student loans.

Front

If Claude's assets are $24,950 and liabilities are $50,370, what is his net worth?

Back

-$25,420.