Financial Literacy Quiz

Sylvester is taking out a loan and is confused by the jargon. Which of the following explanations might help him?

• TERM is the length of the loan, and INTEREST RATE is how much total money he will pay

• PRINCIPAL is how much he owes per month, and TERM is how much he owes overall

• INTEREST RATE is how much the lender charges per year for the loan, and PRINCIPAL is the initial amount Sylvester borrows

• MONTHLY PAYMENT is how much interest costs him each month, and TERM is the name of his lender

Which should you use when creating a budget - your NET PAY or GROSS PAY?

• Net pay, because it’s what is reported to the government by your employer for tax purposes

• Gross pay, because it’s the total amount you’ve earned that month

• Net pay, because it’s the total amount you’ve earned minus taxes and other deductions

• Gross pay, because it’s the total amount you’ve earned minus any recurring bills you owe for the month

Which of the following is a recommended way of following up with a personal connection after a job interview?

• Returning to the office the next day to express your continued interest in the job

• Buying the interviewer(s) a gift

• Sending a friend request to the interviewer(s) on social media

• Sending a personalized thank you letter or email

Which amount is found when you subtract your grants and scholarships from a college’s cost of attendance?

• Sticker price

• Net price

• Student Aid Index

• Room & board

All of the following are benefits of taking out a loan with a cosigner EXCEPT…

• There are no penalties for late payments

• You gain access to loans you might not have been approved for on your own

• Your interest rate might be lower

• Your credit score will be positively impacted by making timely payments

Which of the following is a method of accessing the money in your checking account?

• Buy a prepaid card using cash

• Deposit a paycheck from your job

• Insert your debit card at a store and sign the electronic machine or paper receipt

• Take money from the ATM using your credit card

Your little sister wants to know how renters insurance works. Which description should you give her?

• When something goes wrong at your apartment, you pay one premium to open a renters insurance policy and ask the insurance company to cover your losses

• Your rent payments go to the building’s owner, and that person covers your losses if anything goes wrong at your apartment

• You pay monthly premiums into a savings account, and if something goes wrong, you can withdraw the money to pay your claims

In order to qualify for financial aid, prospective college students must submit their ___________.

• Financial aid letter

• FAFSA

• PSAT, SAT, or ACT scores

• Parent's credit score

Which of the following best describes the amount of money you'll have if you put $1000 into a CD earning 2% annual compound interest for 10 years? You can ignore the impact of inflation in this question.

• The same $1000 you started with

• Exactly $1200

• Slightly more than $1200

• $2000

Which of the following can be found in your credit report?

• Your checking and savings account balances

• How long you’ve been a member of a bank or credit union

• Your credit payment history

• A list of items you’ve purchased using credit