FBLA Personal Finance Test

Front

What does APR stand for in the context of loans and credit cards?

Back

Annual Percentage Rate

Front

What is the purpose of a budget?

Back

To plan and track income and expenses

Front

Which of the following is considered a fixed expense? Groceries, Entertainment, Rent, Dining Out

Back

Rent

Front

What is the term for a loan that is backed by collateral?

Back

Secured loan

Front

Which type of investment typically offers the highest potential return? Options: Stocks, Bonds, Savings accounts, Certificates of deposit (CDs)

Back

Stocks

Front

What is the purpose of insurance?

Back

To protect against financial loss

Front

Which of the following is a benefit of a Roth IRA? Tax-deductible contributions, Tax-free withdrawals in retirement, Employer matching contributions, Penalty-free withdrawals at any time

Back

Tax-free withdrawals in retirement

Front

What is the recommended percentage of income to save for emergencies?

Back

5-10%.

Front

Which of the following is a disadvantage of using a debit card? Options: Interest charges, Risk of overspending, No purchase protection, Lower acceptance than credit cards

Back

Risk of overspending

Front

What is the primary function of a credit score?

Back

To determine eligibility for loans and credit cards