Financial Literacy Flashcard 1.1 Practice

Front

Which of the following is a good example of making a financial 'trade-off'?
Options:
skipping a few classes at school to go shopping at the mall.
skipping a few dinners out to save for a weekend trip.
skipping a few days of work to look for a new job.
trading your U.S. dollars for Euros.

Back

skipping a few dinners out to save for a weekend trip.

Front

What is the agency responsible for collecting taxes at the federal level?

Back

Internal Revenue Service (IRS).

Front

If the inflation rate is 3%, how will it affect the purchasing power of someone typically spending $200 on consumer goods?

Back

Their purchasing power will decrease.

Front

Who in our economy is most impacted by a rising rate of inflation?

Back

Retirees living on fixed incomes.

Front

If a person increases the number of withholdings on their W4 form, their paycheck will

Back

decrease

Front

What is the potential advantage of using a direct deposit for receiving a paycheck?

Back

It allows for quicker access to the funds compared to receiving a paper check.

Front

Which answer choice reflects the mandatory federal payroll deductions that are typically withheld from an employee’s paycheck? Options: Social Security, Medicare, and Federal income taxes., Retirement, health insurance, and life insurance benefits., Medicaid, State, and Federal income taxes., Social Security, Medicare, State and Federal income taxes.

Back

Social Security, Medicare, and Federal income taxes.

Front

What is a payday loan?

Back

A short term, high interest loan typically due on the borrower’s next payday.

Front

What is one potential benefit of obtaining a college degree when it comes to job opportunities?

Back

It may increase earning potential.

Front

You are considering two job offers: one offers a high salary and comprehensive health insurance while the other offers a similar salary, plus comprehensive health insurance, retirement benefits, and paid time off. Which financial concept should you consider to accurately compare the value of these benefits?

Back

Total compensation.