JA Financial Literacy: Theme One

What is the main reason why people make voluntary exchanges of goods and services in a free market or capitalist system?

• They expect to be better off as a result of an exchange.
• They anticipate a time when exchanges will be more costly.
• They follow laws of economics that require frequent exchanges.
• They view exchanges as a good way to compete with other parties

Amit loves baking cookies and his friends tell him they're delicious. He decides to see if people would be willing to buy them. Which of the following is the MOST capitalist behavior for Amit in this situation?

• He starts a blog to share his cookie recipes for free.
• He uses the best ingredients he can find, regardless of cost.
• He researches what kind of cookies are most popular and bakes those.
• He donates a portion of his profits to a local charity.

Sonya makes screen-printed shirts and her neighbor, Tony, is skilled at training dogs. Sonya recently got a dog that needs to be trained and Tony’s school club needs new shirts. Instead of paying a professional dog trainer, Sonya asks Tony to train her dog. In return, she agrees to print shirts for Tony’s school club. This is an example of:

• Bargaining
• Exploitation
• Lending money
• Bartering

Which of these is a form of earning?

• Wages
• Theft
• A lottery win
• An inheritance

Which would be considered an unanticipated life expense?

• Furthering education
• Childcare
• Managing a long-term illness
• Leasing a vehicle

Which might be found at the U.S. Department of Labor website?

• Information about car insurance
• Facts about mortgages
• Career resources
• Federal guidelines for healthcare

The following are examples of the benefits of getting a certificate or degree through trade school EXCEPT:

• Lower initial cost outlay for education
• Less time invested
• Hands-on job experience is often provided
• High amount of perceived prestige

Nova wants to work in graphic design but isn't sure how much education she needs. She loves to be creative and can learn software programs quickly. Which post-high school option would be BEST for Nova, if she wants to earn the most amount of money throughout her career?

• Pursue a bachelor's degree at a college or university.
• Take online software classes and get certifications in a few different design programs.
• Attend a college or university to earn an associate degree.
• Starting working as soon as possible, so she starts earning money immediately.

Which of the following is NOT information needed to complete the Free Applicate for Federal Student Aid (FAFSA) form?

• The student’s marital status
• Tax records from the student’s parents or legal guardians
• Where the student’s parents’ or legal guardians’ work
• The student’s mailing address

What is the difference between gross pay and net pay?

• Net pay is the amount of pay remaining after deductions have been removed from a paycheck, while gross pay is the amount you earn.
• Gross pay is exempt from taxes, while net pay is used to determine taxes.
• Only gross pay can be used to determine budget, while net pay is used to determine disposable income.
• Net pay is always the larger amount, while gross pay is the desirable amount.