Financial Literacy Quiz

Select ALL of the common sources of retirement income from the following...

• Social Security

• Pension Income

• Government loan

• Investment Income

Isabel has $3000 per month to spend. She estimates her monthly costs to be: rent of $1200, car expenses of $658, utilities of $90, insurance of $100, food for $250 and other expenses of $60. What is the end result?

• She went over budget by $642

• She went over budget by $1925

• She went under budget by $642

• She went under budget by $1925

Which of the following actions will NOT take money directly OUT of your checking account? (Select all that apply)

• Use your credit card to pay for groceries

• Use your debit card to withdraw cash from the ATM

• Deposit a check at a bank branch

• Buy a prepaid car using cash

How do insurance companies determine how much they will charge their members?

• Insurance companies use statistics to see how likely it is for a customer to switch companies and charge them more for the short time they’re customers

• The more people wanting insurance with a company creates a bigger demand and drive up the price of premiums for everyone

• Your insurance company pools premium funds from all their clients and uses this money to pay any individual claims that happen

• Companies assign premiums randomly to new customers according to a normal distribution statistical model

Tags

CCSS.HSS.MD.B.6

CCSS.HSS.MD.B.7

What is the difference between secured and unsecured debt?

• Secured debt is guaranteed by the federal government, unsecured debt is not

• Secured debt requires a background check to obtain it, unsecured debt can be obtained by anyone

• Secured debt is backed by an item of value as collateral, unsecured debt has no guarantee for the lender

• Secured debt requires a contract to be signed, unsecured debt can be a verbal agreement

Allen told you that it’s a good investment strategy to diversify your portfolio. What is he suggesting you do to have an investable portfolio that is diversified?

• Using various methods of research to be sure that your investments are good ones

• Not buying shares that are popular during a given day

• Investing in a variety of assets to spread out the risk

• Only buying stocks when their prices are low

What does the S&P 500 represent?

• A type mutual fund

• A company that is traded on the stock market

• An index of many different types of bonds and their performance over the last 500 days

• An index of the 500 largest publicly traded companies in the US

Who most likely needs to complete a W-4 form?

• Annie, who wants to increase her retirement contributions to her 401(k)

• Patricia, who is enrolling in a new health insurance plan

• John, who just started a second job and wants to adjust his tax withholdings

• Chris, who needs an extension for additional time to file her taxes

How much do experts recommend you should save in an emergency fund?

• $1000

• 1 month of your average pre-tax earnings

• 3-6 months of your average living expenses

• 6-12 months worth of saving 10% of your income

Which of the following is a NOT benefit of having a checking account at a bank?

• Checking accounts generally have lower fees than alternative services like check cashers

• Checking accounts generally have higher interest rates than savings accounts

• Checking accounts enable you to set up direct deposit and pay bills online

• Checking accounts protect your money with FDIC insurance up to $250,000