Personal Finance Knowledge Check

The amount of federal income tax withheld depends on both your level of earnings and the number of withholding allowances claimed.

• TRUE

• FALSE

According to the "Rule of 72", my money will double in how many years:  Investment earning 4%.

• 3

• 18

• 9

• 1

Which one describes the balance sheet equation:

• Net Worth = Liabilities + Assets

• Assets * Value = Equity

• Assets = Liabilities + Net Worth (Equity)

• None of the above

Every individual or married couple is required to file a federal income tax return regardless of the amount of income earned.

• TRUE

• FALSE

Tax credits and deductions reduce your taxable income by comparable amounts.

• TRUE

• FALSE

At most banks and other depository institutions, you will be hit with a hefty service charge if your checking account balance falls even just $1 below the stipulated minimum amount for just one day out of the month. 

• TRUE

• FALSE

U.S. Series EE and I savings bonds are not a very good way to save.

• TRUE

• FALSE

How much would a home buyer have to pay at the time of closing -- take into consideration closing costs (50% of the down payment), down payment (20%), and a loan fee of 2 points.  The home is $250,000 and requires a 20% down payment.

• 75,000

• 79,000

• 82,000

• 85,000

You should buy a car instead of leasing if you plan to drive it more than 150,000 miles over its life.

• TRUE

• FALSE

Excluding mortgage payments, most families will have little or no credit problems so long as they limit their monthly credit payments to 25 to 30 percent their monthly take-home pay.

• TRUE

• FALSE