Finance 1 - Personal Finance

When borrowing money, do you want a high interest rate or a low interest rate?

• You want a high interest rate.

• You want a low interest rate.

• The interest rate won't matter.

Michael earns $55,000 for the year and takes the standard deduction of $12,200. What is his taxable income?

• $55,000

• $42,800

• $43,200

• $12,200

What does "deduction" mean when doing taxes?

• The amount of tax you pay.

• The amount of income on which you DON'T pay taxes.

• The amount of income on which you DO pay taxes.

• The amount you get back as a refund each year.

What does "withholding" mean when talking about taxes?

• The amount your company withholds from your paycheck to pay taxes.

• The amount that you hold back and don't tell the government you earned.

• The amount you receive as a refund at the end of the year.

• The amount on which you don't have to pay taxes.

Jane's income is $55,000 and she takes the standard deduction of $12,200. Her tax rate is 15%. How much tax will she owe for the year?

• $42,800

• $12,200

• $6,420

• $535

If you invest $4,000 at 6% for 10 years, what is your principal?

• $4,000

• .06

• .6

• 10

If you invest $4,000 at 6% for 10 years, what value for "r" will you use in your formula?

• 10

• .6

• .06

• $4,000

If you borrow $5,000 at 7% interest compounded annually for 4 years, how much will you have to pay back IN ALL?

• $1,400

• $6,400

• $1,553.98

• $6,553.98

Your rich uncle invests $10,000 when you are born to help you pay for college. If the account earns 7% simple interest, how much will you have IN ALL to help pay for college when you turn 18?

• $12,600

• $22,600

• $23,799.32

• $33,799.32

The Ware Family budget is $5,000 per month. Use the graph to determine how much more they spend on their mortgage than on their recreation.

• $1,150

• $500

• $650

• $550