Finance Quiz

Scenario 3: You have a monthly income of $4000 and your total monthly expenses are $3500. What percentage of your income are you saving?

How does an increase in sales tax rate affect consumer purchasing behavior?

• Higher sales tax leads to increased spending

• Higher sales tax leads to decreased spending

• Sales tax has no impact on consumer purchasing behavior

• Sales tax directly correlates with consumer income

What is the purpose of creating a budget?

• To restrict spending on necessities

• To eliminate all discretionary spending

• To track income and expenses, and plan for the future

• To maximize debt accumulation

Scenario 2: You are planning to buy a car for $20,000 and your annual income tax rate is 25%. Calculate the total cost of the car including income tax.

• $22,500

• $23,000

• $24,000

• $25,000

A product costs $50 with a sales tax rate of 8%. How much will the total cost be including sales tax?

• $54

• $52

• $56

• $58

What is NMI (Net Monthly Income) and how is it calculated?

• Total monthly income after taxes

• Total monthly income before taxes

• Total monthly expenses

• Total monthly savings

How are property taxes calculated, and how do they impact homeowners?

• Calculated based on property value | Impact: higher property taxes reduce disposable income

• Calculated based on income | Impact: lower property taxes reduce disposable income

• Calculated based on location | Impact: property taxes have no impact on homeowners

• Calculated based on mortgage amount | Impact: property taxes increase disposable income

Scenario 1: You have a NMI of $3000 and your total monthly expenses are $2500. How much should you allocate towards savings and investments?

• $300

• $500

• $1000

• $1500

Explain the difference between progressive, regressive, and proportional income taxes.

• Progressive: higher income, higher tax rate | Regressive: lower income, higher tax rate | Proportional: same tax rate for all incomes

• Progressive: lower income, higher tax rate | Regressive: higher income, higher tax rate | Proportional: varying tax rates

• Progressive: lower income, lower tax rate | Regressive: higher income, lower tax rate | Proportional: same tax rate for all incomes

• Progressive: higher income, lower tax rate | Regressive: lower income, lower tax rate | Proportional: varying tax rates

Define budget and explain the importance of budgeting in personal finance.

• Budget: tracking expenses | Importance: helps in overspending

• Budget: planning income and expenses | Importance: helps in managing finances and achieving financial goals

• Budget: saving money | Importance: helps in spending more

• Budget: investing money | Importance: helps in increasing debt