Financial Literacy Semester Test

Which of the following is a want--not a need?

• rent payment

• car insurance

• internet service

• groceries

Where should you look for the fairest and most reliable information when you go to buy a computer?

• a popular computer company website

• advertisements by a computer company

• an independent consumer education website the reviews and rates computers

• a salesperson in a computer store who works on commission

What should you include when creating a budget?

• all income and expenses

• fixed expenses but not income

• income but not variable expenses

• fixed and variable expenses but not taxes

Which is a variable expense?

• monthly cost of eating out

• monthly rent payment

• monthly car loan payment

• monthly health insurance payment (premium)

If you find the unit prices of 2 different brands of cereal, you are better able to

• compare the prices of the two brands to find the better buy

• estimate how much of the item you will need

• determine which of the cereal brands is higher quality

• figure out the discount during a sale on the cereals

Which is NOT TRUE of a budget?

• Budgets help you plan how to spend money you earn

• Never change your budget once you finish making it

• A budget can include money for donations

• Budgets include all expenses and income

Which is NOT a successful budgeting strategy?

(which is a bad idea)

• Keep some extra money for emergencies

• Pay with a credit card if you can't stick to the budget

• Think about what are the most important needs

• Look at your budget regularly and make adjustments

Which is paid biweekly (every other week) or monthly?

• salary

• hourly wage

• stipend

• benefit

What is the best strategy to avoid paying interest on your credit cards?

• Pay the minimum balance each month

• Pay the full balance each month

• Have credit cards from two different banks

• Make payments online

What is the problem with paying only your minimum credit card balance each month?

• It lowers your credit score

• You have to pay interest

• The bank will cancel your credit card

• All of these