Personal Finance Pre-Assessment

Compound interest is interest paid on interest previously earned.

• True

• False

It is important to build up your FICO score by taking out credit cards and car loans.

• True

• False

The purpose of insurance is to transfer risk.

• True

• False

Opportunity cost is the value of the option you chose to take (you'd better get this one right!)

• True

• False

It is not necessary to record debit card transactions in your check register because accounts are now online.

• True

• False

Medicare and Social Security compose a payroll tax called FICA.

• True

• False

One of the most important factors to consider when choosing a career is income potential.

• True

• False

One way to protect your identity is to carry your Social Security card in your wallet.

• True

• False

Mutual funds are comprised of several thousand stocks.

• True

• False

A Roth IRA is used for retirement savings.

• True

• False