Quiz about Unit 11: Financial Literacy

Question 1

John is deciding whether to use a debit card or a credit card to purchase a $50 remote control helicopter. Which statement best describes the card John should use to make his purchase?

Accepted Answer

He should use a debit card, because it is used like cash or checks.

Answer

He should use a credit card, because it withdraws the money from his bank account automatically.

Answer

He should use a credit card, because it can withdraw money from a bank account as purchases are made.

Answer

He should use a debit card, because it is used like a personal short-term loan.

Question 2

A portion of Ashlyn's check register is shown. Based on the information, what is the ending balance?

Accepted Answer

$2,216.10

Answer

$-130.65

Answer

$2,279.95

Answer

$1,141.45

Question 3

Which information would typically appear on a consumer's credit report?

Accepted Answer

The balance owed on the consumer's credit cards.

Answer

The cost of tuition at the consumer's chosen college.

Answer

The name of the consumer's employer.

Answer

The value of the consumer's home.

Question 4

Susanne is going to college and was informed that she will get a grant to pay for her tuition. Which statement describes a grant?

Accepted Answer

Money that a student receives based on need and does not need to pay back

Answer

Money that a student receives in exchange for work

Answer

Money that a student must pay back when he or she graduates

Answer

Money that a student has started saving well before the start of college

Question 5

Mark needs to open a bank account to get a debit card so he can withdraw cash and pay for online transactions. The table shows some fees that different financial institutions charge for services related to this type of account.

Based on the information given in the table, which financial institution should Mark use to get a debit card to withdraw cash?

Accepted Answer

Park Bank

Answer

Village Bank

Answer

Great Bank

Answer

All Bank

Question 6

Ken says that the information on his credit report can be retained for only 1 year. Is Ken correct?

Accepted Answer

No, because most credit report information is retained for 7 years.

Answer

Yes, because the consumer chooses how long credit report information is retained.

Answer

Yes, because most credit information is updated monthly.

Answer

No, because all credit report information is retained indefinitely.

Question 7

Which statement describes a value of a positive credit report to a borrower?

Accepted Answer

Getting lower interest rates when applying for a loan

Answer

Having extended periods to pay off a loan

Answer

Getting discounts when buying expensive items

Answer

Making an extra payment on a credit payment schedule

Question 8

Estimated average annual salaries and minimum levels of education for different occupations are shown in the table.

Based on the information in the table, which statement is true?

Accepted Answer

For the jobs listed in the table, as the minimum level of education increases, the estimated average salary increases.

Answer

The minimum level of education required for a physician assistant is less than the minimum level of education for a firefighter and a lawyer.

Answer

The estimated average salary of an accountant is less than a lawyer but greater than a physician assistant.

Answer

For the jobs listed in the table, as the minimum level of education increases, the estimated average salary decreases.

Question 9

Next year, Richard is getting a student loan to pay for college. Which statement best describes a student loan?

Accepted Answer

Borrowed money that must be paid back with interest

Answer

Money that is awarded to students usually based on need with no obligation to repay

Answer

A bank account in which a person's money earns interest

Answer

Money that is awarded to students based on educational achievement with no obligation to repay

Question 10

Louise made the following statement:

"Credit cards and debit cards have the exact same benefits."

Which statement correctly describes Louise's statement about credit cards and debit cards?

Accepted Answer

Her statement is not true because a debit card can be used as cash and a credit card can be used to finance a purchase.

Answer

Her statement is true because debit cards and credit cards pay interest to the user.

Answer

Her statement is true because debit cards and credit cards charge the user interest on the amount of the purchase.

Answer

Her statement is not true because a credit card can be used as cash and a debit card can be used as a short-term loan.

Question 11

The table shows the monthly fees for checking accounts at two banks.

Which statement is best supported by the information in the table?

Accepted Answer

The fee at Bank K will be greater than the fee at Bank F whenever the average daily balance is less than $750.

Answer

The fee at Bank K will always be less than the fee at Bank F.

Answer

The fee at Bank K will always be greater than the fee at Bank F.

Answer

The fee at Bank K will be less than the fee at Bank F only when the average daily balance of $750 is maintained.

Question 12

Anna would like to purchase a new mountain bike that costs $600. She only has $300 in her checking account now. Which of the following statements is true?

Accepted Answer

She can use her credit card to buy the bike now and pay it off over a period of time.

Answer

She can use her debit card to pay for the bike and pay off the debit card over time.

Answer

She can save up the remainder of the balance and then pay with a credit card.

Answer

She can use her debit card to pay for the bike directly from her bank account.

Question 13

A vocational school offers different tracks for different types of mechanics. Over a 20-year career, how much more will the aircraft mechanic make than the automotive mechanic?

Accepted Answer

$436,000

Answer

$654,000

Answer

$21,800

Answer

$545,000

Question 14

Which of the following situations does not describe the use of a credit card?

Accepted Answer

allows for unlimited purchases

Answer

may earn rewards

Answer

can be used to build a positive credit history

Answer

purchases may be subject to interest charges

Question 15

Two different banks are advertising their checking accounts. Which of the following is a

better choice if the Jackson family averages about $2,200 in their checking account?

Accepted Answer

Bank of Texas

Answer

Main Street Bank

Answer

They are equally good choices

Question 16

The average salaries of three different positions are shown in the table below. Based on the information, how much more will the physician earn than the paralegal over a 15-year career?

Accepted Answer

$1,029,900

Answer

$68,660

Answer

$432,400

Answer

$864,200

Question 17

Lucas is planning to attend a state university and qualifies for financial aid. Which of the methods below can Lucas apply for solely based on his financial need?

Accepted Answer

grant, work-study

Answer

scholarship, grant, student loan

Answer

work-study, student loan, grant

Answer

student loan, work-study

Question 18

Jose is looking for a job while he takes part-time college classes. The annual salaries

for three jobs he is interested in are shown below. How much more will he earn as a

veterinary tech than a barista for the four years he is in school?

Accepted Answer

$51,440

Answer

$41,040

Answer

$10,260

Answer

$12,860

Question 19

Which of the following situations does NOT describe the use of a debit card?

Accepted Answer

Finley purchases a present by swiping her card. She doesn't have the money for the present now, but she will before the bill is due.

Answer

Margie purchases a coffee in the drive thru. She swipes her card and the funds are immediately withdrawn from her account.

Answer

Ralph purchases a book at the bookstore. He types in a secure code at checkout.

Question 20

Ms. Brentfield is planning to take out a loan to buy a home. When applying, she must sign a statement giving permission to check her credit report. Which statement best describes why the mortgage company is requesting to check her credit?

Accepted Answer

To determine the likelihood of Ms. Brentfield paying back the loan

Answer

To determine if Ms. Brentfield will take good care of her home

Answer

To decide how much money Ms. Brentfield earns

Answer

To determine if Ms. Brentfield can afford the home

Question 21

Mr. Boxer has organized the features of credit and debit cards into a table below.

Which description is the best representation for the missing detail?

Accepted Answer

Purchases are paid back over time or at a later date

Answer

Purchases are unlimited in funds

Answer

Purchases must be paid in a one-time payment

Answer

Purchases are subject to a credit limit

Question 22

Mr. Hernandez is searching for a new checking account. He compares the fees associated with two different banks in his town. Which of the following statements best supports the information?

Accepted Answer

Mr. Hernandez should choose Star Bank if he normally has $800 in his bank account

Answer

Mr. Hernandez should choose Star Bank because it has no fees.

Answer

Mr. Hernandez should choose First Bank because the fees are the same.

Answer

Mr. Hernandez should choose First Bank because the fee is just $10.

Question 23

Which of the following best represents a withdrawal from a checking account?

Accepted Answer

You go to the ATM and get cash

Answer

You take your paycheck to the bank and put it in your account

Answer

You receive a check for your birthday and go to the bank to cash the check

Answer

You move money from your checking account to your savings account

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