Financial Responsibility and Budgeting

Gaia’s gross pay per month is $2,895. Her deductions are listed in the table.

What is Gaia’s net pay each month?

• $2,310

• $2,349

• $2,475

• $2,571

Mikkel pays a 4 percent state income tax on his earnings. If he earns $1,867, how much state income tax can he expect to pay?

• $46.68

• $74.68

• $466.75

• $746.80

Benito’s family is thinking of relocating from Los Angeles to Oakland to save money. They set up a budget comparing the cost of living for both cities.

How much money will they save monthly by the move to Oakland?

• $1315

• $1560

• $1665

• $1765

Dima called her friend to tell her that she saved 30% on her new skirt at a discount store. Her friend told her that she could have gotten a better deal at a different store that was advertising a sale of 1/3 off all clothing. If the original price of Dima’s skirt was $54, how much more could she have saved at the store her friend suggested?

• $1.11

• $1.80

• $36.00

• $37.80

Insurance is a financial service that allows a

• consumer to transfer all risk to a company.

• company to control finances for a consumer.

• consumer to share liability with a company.

• company to maximize risk for a consumer.

What are the main purposes of a budget? Select two options.

• to take out a student loan from the bank

• to plan future income and spending

• to apply for a mortgage

• to balance available resources and expenses

Read the passage about a family health insurance plan.

Maria's family has a health insurance plan. Her mother has $350 deducted from her paychecks each month. When Maria visited the doctor, her mother paid a $25 fee. The insurance company covered the rest of the cost of the visit. When Maria's mother went to the hospital, her family was responsible for paying the first $1,000 of the bill. After this payment, the insurance company covered the rest of the costs.

What is the $25 fee Maria's mother paid when Maria visited the doctor?

• payout

• deductible

• co-payment

• premium

The basic purpose of insurance is to provide

• loans.

• prevention.

• protection.

• liability.

Most people prefer to pay health insurance premiums rather than pay out-of-pocket for medical expenses because

• people are cautious and believe they are less likely to get sick if they have health insurance coverage.

• doctors and hospitals always provide better care to people who have health insurance.

• people still feel more secure with a health insurance policy, even though out-of-pocket costs are often lower.

• medical costs can be extremely high, and insurance is more affordable than paying out-of-pocket for a hospital stay

Which person made the best payment decision for their preferences?

• Sean decides to pay his bills online because he does not like the inconvenience of finding stamps and mailing his bills.

• Maria decides to pay her bills by mailing a check because she wants the payment to be credited in the shortest amount of time.

• Jonah decides to pay his bill by telephone because he wants to protect his account information.

• Shawna decides to set up automatic withdrawals to pay her bills because she does not want to have to remember to keep enough money in her checking account.