Financial Literacy EXAM semester 1_2023

Income can be earned or unearned. Which of the following is an example of unearned income?

• Money from a part-time second job.

• Tips from customers

• Interest from bank accounts.

A risk of using a debit card for buying goods and services is that

• there may be insufficient funds in the bank account.

• there may be a hidden fee for each purchase.

• the repayment period may be shorter than thirty days.

Which of the following is an advantage of people increasing their personal savings?

• The economy grows faster when people save money rather than spend it.

• The government benefits from taxes on savings.

• People are better able to afford items such as a future down payment on a home.

When making online transactions, it is important to minimize the threat of identity theft by

• using unique password and changing it frequently.

• using a desktop computer instead of a mobile device.

• shutting down the computer and erasing the memory each day.

Which of the following government programs would provide partial income to support someone who is permanently disabled?

• Affordable Care Act

• Americans with Disabilities Act

• Social Security

Banks and other companies are willing to issue credit cards because these financial institutions

• make money on the interest they charge on unpaid balances

• own credit counseling agencies

• are required by recent laws to make money available

"I pay my credit card bill in full five-to-seven days before the due date each month!" Someone who does this is likely to have

• a very high interest rate

• adequate insurance coverage

• an excellent credit score

A person's credit report includes his or her

• medical history and driving record

• history of loans and credit activities

• retirement and savings account balances

Which of the following federal laws protects borrowers?

• Social Security Act

• National Privacy Act

• Truth in Lending Act

One example of using credit responsibly is

• charging an expensive item that is on sale for one day when cash will be available next week

• paying less than the minimum balance on a monthly bill

• buying a leather coat with the intention of paying the cost over four years