Chapter 2: Budgeting Basics Assessment

Although the majority of Americans think budgeting is important, about _______ of Americans actually use a budget.

• 75%

• 50%

• 23%

• 35%

Which of the following is NOT a component of a budget?

• Credit Score

• Saving

• Income

• Giving

Online budgeting apps are more effective than budgeting with pen and paper.

• True

• False

Answer explanation

It depends on what works best for that individual.

What are the Four Walls?

• Utilities, college fund, restaurants, and car insurance

• Cell phone bill, car insurance, shelter, and money for the movies

• Food, utilities, transportation, and college fund

• Food, utilities, shelter, and transportation

How many categories should you have in your budget?

• 15 or more

• No limit; use as many as you need to keep your budget accurate!

• No more than 10

• At least 3

How often should you create a budget?

• Daily

• Weekly

• Monthly

• Biannually

If you get married, only one person is responsible for budgeting.

• True

• False

What does a budget show you?

• How much you need to save

• How much money you plan to come in and go out during the month

• How much money you need to earn

• How much money you spent last month

Detailed categories on your budget will help you make better spending decisions.

• True

• False

A budget says what will happen with your money, while a cash-flow statement shows what already happened.

• True

• False