Financial Literacy Final Exam

What is an overdraft fee?

• A fee for depositing too much money

• A fee for withdrawing money from savings

• A fee charged when you spend more money than you have in your checking account

• A fee for transferring money between accounts

Which of the following is typically required to open a savings account?

• An Initial Deposit

• A driver's license or state ID

• Your Social Security number

• All of the above

What is a common feature of savings accounts that is not typically offered with checking accounts?

• The ability to write checks

• Higher interest rates

• Unlimited transactions

• Overdraft protection

According to many financial experts and what we have learned in this class, what is the minimum Emergency Fund you should have saved up?

• 1-3 months of living expenses
• 3-6 months of living expenses
• 6-9 months of living expenses
• 9-12 months of living expenses

What is a good strategy to help you save?

• 1st, spend money on all expenses; put the rest into saving
• Tap into your savings on a regular basis to purchase small items, like snacks
• Pay yourself first - set aside money for savings each month
• Keep your spending and saving money together in 1 account

The FDIC insures bank accounts against bank failure up to the sum of

• $100,000

• $250,000

• $1,000,000

• $0

What is compound interest?

• Interest on the original amount deposited and interest earned last year or quarter.

• Interest calculated based on the borrower's credit score

• Interest calculated only on the initial principal

• Interest that grows the faster you withdrawal money from your account.

Which of the following is an example of a fixed expense?

• Electricity bill

• Grocery shopping

• Rent

• Dining out

Which of the following is a variable expense?

• Mortgage payment

• Car insurance

• Utility bills

• Internet subscription

Why is it important to review and adjust your budget regularly?

• Your financial situation and goals may change

• It is not necessary to review the budget

• Fixed expenses will decrease over time

• Variable expenses do not change