Financial Literacy Quiz

What is the best way to manage credit card debt?

• Take out a personal loan to pay off the credit card debt

• Create a budget and prioritize high-interest debt

• Ignore the debt and hope it goes away

• Continue making minimum payments on all credit cards

What is considered a source of income?

• Income from employment, investments, business, or other sources

• Income from volunteering

• Income from hobbies

• Income from spending

What is the purpose of a savings account?

• To hide money from the government

• To spend money quickly and easily

• To store and grow money over time while earning interest

• To use as a checking account for daily expenses

What is the main function of a bank?

• Provide financial services

• Offer legal advice

• Sell groceries

• Provide medical services

What is the best way to track your expenses?

• Asking a friend to track them for you

• Keeping all receipts in a shoebox

• Guessing and hoping for the best

• Using a budgeting app or software

What is the consequence of not paying your bills on time?

• Late fees, interest charges, and damage to credit score

• Discounts and rewards for late payments

• Free credit score improvement

• No consequences at all

What is the difference between a credit card and a debit card?

• A credit card is only for online purchases, while a debit card is for in-person purchases

• A credit card has a higher interest rate than a debit card

• A credit card allows you to borrow money, while a debit card uses the money you already have.

• A credit card and a debit card are the same thing

What is the purpose of a budget?

• To train a pet

• To predict the weather

• To make paper airplanes

• To plan and track income and expenses

What is the benefit of having a good credit score?

• To qualify for higher interest rates on loans and credit cards, spend more money on insurance premiums, and decrease chances of getting approved for rental housing or a mortgage.

• To qualify for no interest rates on loans and credit cards, save money on insurance premiums, and decrease chances of getting approved for rental housing or a mortgage.

• To qualify for lower interest rates on loans and credit cards, save money on insurance premiums, and increase chances of getting approved for rental housing or a mortgage.

• To qualify for higher interest rates on loans and credit cards, spend more money on insurance premiums, and increase chances of getting approved for rental housing or a mortgage.

What is the role of a financial institution?

• To provide financial services such as accepting deposits, lending money, and facilitating financial transactions.

• To sell groceries

• To provide medical services

• To offer legal advice