FINANCIAL LIT- PRETEST

Things you own that have monetary value, like a house.

• liability

• asset

• debt

• equity

Interest is:

• a charge for lending money to a bank

• the amount owed for borrowing money

• the amount added into your savings when opening a bank account

• a charge for the convenience of accessing money stored in your bank account

The purpose of a budget is to:

• help you plan how you will spend the money you earn or receive.

• stop you from spending too much money.

• increase the balance of your savings account

• tell you how much you owe the government in taxes

Which type of financial institution typically has membership requirements?

• Credit Union

• Online Commercial Bank

• Commercial Bank

• Federal Reserve Bank

Which of the following is a variable expense?

• Student loan payments

• Groceries

• Rental payments

• Health insurance

Which of the following is a fixed expense?

• Clothing purchases

• Groceries

• Rental payments

• Movie tickets

Which of the following actions has NO impact on your credit score?

• a. You inquire about a credit card charge.

• b. You use a large percentage of your credit limit.

• c. You opened several new credit cards last week.

• d. You send in your credit card payment a couple days late.

Which form is your employer required to send to you before you file your tax return?

• Yearly paycheck stub

• 1040EZ

• W-2

• W-4

Which of the following provides the best protection against identity theft?

• Never use a credit card

• Open up a new bank account every year

• Pay all bills with cash only

• Shred documents that contain personal information

Short-term loan from the ***** **** company. At the end of each purchase period (usually a month), you receive a bill with all your charges.

• Debit Card
• Prepaid Card
• Credit Card
• ATM