Personal Finance Final Review

Isaiah works at a technology company in the summer and earns $3000. After federal, state, and Social Security/Medicare taxes are deducted, his take-home pay is $2,500. Which of the statements below is CORRECT?

• His gross pay is $3,000 and net pay is $2,500

• His gross and net pay are $3,000

• His gross and net pay are $2,500

• His gross pay is $2,500 and net pay is $3,000

The purpose of a 1040 form is to...

• Report the total amount of income you received as an independent contractor.

• Provide the information needed to calculate tax withholding from your paycheck.

• File your annual income tax return.

School A has sticker price of $52,000 and an average net price of $6,000 for families with income of less than $60,000. Meanwhile, School B has sticker price of $22,000 and an average net price of $11,000 for families with income of less than $60,000. If your number one factor in selecting a school was cost and your family income was under $60,000, which school would you choose?

• School A

• School B

• Neither school -- only choose a college that will allow you to graduate debt free

• Either school -- you can always take out student loans, and then the cost won't matter as much

Choose the BEST answer: Which of these represents a major convenience of using a mobile banking app?

• Most banks waive all fees for customers who use mobile banking

• Mobile banking is the only way to transfer money electronically between accounts

• You can deposit physical checks by using your phone to take a picture of the front and back and sending it through your mobile app

• You can leave your debit card safely at home, because stores that accept debit will also take payment via your phone instead

In which order do you want to apply for and accept aid to pay for college?

• Scholarships & grants, federal student loans, private student loans, work study

• Scholarships & grants, work study, federal student loans, private student loans

• Federal student loans, work study, scholarships & grants, private student loans

• Federal student loans, private student loans, work study, scholarships & grants

Which of these would represent a withdrawal you could see on your monthly checking account statement?

• Direct deposit of your paycheck

• A credit for a shirt you returned to a store at the mall

• A person-to-person payment from a friend who owed you money for picking up the lunch tab

• A debit card purchase for concert tickets you bought online

Nancy receives his Financial Aid Award Letter and notices Federal Work-study in the amount of $2000. What does this mean?

• He is receiving a $2000 scholarship based on his outstanding work ethic throughout high school

• He is eligible to take a paid work-study job while he attends college, with the expectation that he will use his earnings toward college-related costs

• He will receive a $2000 loan that he does not need to repay until he is working full-time

• He must work a work-study job and earn $2000 before he can enroll in classes

Which statement about student loans is TRUE?

• If you graduate on-time with good grades and earn a diploma, the federal government will pay most of your loans for you

• Making small payments over an extended period of time will reduce the total amount of money you must pay

• It's financially better to pay for college using scholarships and grants than it is to use loans

• If you must take out loans to pay for college, use private loans from the bank because they offer more competitive rates than federal loans

If your auto loan is amortized over 5 years, you will pay ______.

• The same size payment each month

• The same amount in interest each month

• The same amount of principal each month

• A different amount each month

Which deduction is LEAST likely to be taken out of a high school student's paycheck from his part-time job at a department store? Assume he lives in a state that collects income tax.

• State taxes

• Federal taxes

• Medicare & Social Security

• Health insurance premium