Finace

You earn a salary of $40,000 per year and decide to save 20% of your gross pay. You then set a goal of creating a $16,000 emergency fund. How long will it take for you to achieve your goal?

• 2 years

• 3 years

• 6 months

• 1 year

Disposable income is

• Your income minus your income taxes

• Endless money at your disposal

• Money you put toward an emergency fund

• Your income divided by your expenses

Which of these costs would be the MOST difficult to adjust if you were looking to reduce your expenses?

• Dining out at local restaurants

• Expenses for new clothes

• Loan payment on a new car

• Postponing a purchase for a big-screen TV

Describe one method of keeping track of all of your expenses in a month.

• Spend whatever amount of money you want to on expenses.Spend whatever amount of money you want to on expenses.,

• Buy the newest and latest fashion clothes.

• Categorize your expenses.

• Track your expenses for the year at the end of the year.

You are putting together your first post-graduation budget. Your take-home pay will be $2,500 per month. You estimate your monthly costs to be rent of $800, car payment of $350, car insurance of $150, car maintenance of $50, entertainment of $500, food expense of $250, cable bill of $75, mobile phone of $100, student loan payment of $100 and other expense of $300. How would you describe your budget after analyzing all of your income and expenses?

• You have a surplus of $2,500.

• You have a deficit of $175.

• You have a surplus of $175

• You have a deficit of $2,675.

Isaiah works for the summer at a technology company and has a salary for the summer of $3,000. After federal and state taxes and Social Security/Medicare taxes are deducted, his take-home pay is $2,500. Which of the statements below is correct?

• His gross pay is $2,500 and net pay is $3,000.His gross pay is $2,500 and net pay is $3,000.,

• His gross pay is $3,000 and net pay is $2,500

• His gross and net pay are $3,000

• His net pay and gross pay are $2,500.

What kind of expense is a rent payment?

• Unfixed expense

• Flexible expense

• Preliminary expense

• Fixed expense

You should use your net income, or income after taxes have been taken out, to create a more accurate budget.

• True

• False

What is the purpose of a personal budget?

• List all of your investments

• To make a plan to organize and manage your money based on how much you earn and spend.

• Figure out how much you have saved for emergencies

• Guarantee you earn more

Aaron realizes he has a budget deficit of roughly $175 at the end of two months in a row. Which of these options makes the most sense for him to fix his problem?

• Contribute $100 less to savings each month and $75 less to his retirement fund

• Sell his current car and get a less expensive vehicle

• Cancel his cable TV subscription and go out to dinner three fewer times each month with friends

• Start paying just the minimum monthly payment on his student loan and credit card debt, instead of the extra he's been contributing