Financial Literacy Quiz

What is a budget?

• A plan for making and spending money

• A type of loan

• A fee for services

• A negative balance

What does the term "expense" refer to?

• Money earned from work

• Money spent on goods and services

• Money saved in a bank

• Money borrowed from a friend

What does "interest" refer to in financial terms?

• The cost of a service

• The fee charged for borrowing money

• The amount saved in a bank

• The total income earned

Why is it important to use credit responsibly?

• To increase your expenses

• To avoid financial problems

• To reduce your income

• To increase your loan amount

How can making a personal budget lead to financial responsibility?

• By increasing your expenses

• By tracking your income and spending

• By borrowing more money

• By ignoring your savings

What is the goal of budgeting according to the text?

• To have a deficit

• To have a surplus

• To keep a positive balance

• To spend more than you earn

What should you do if you have a deficit at the end of the two-week period?

• Increase spending

• Save the extra money

• Look for ways to cut spending or earn more money

• Spend more on entertainment

What is credit?

• Money saved for future use

• Money borrowed to pay for goods or services

• Money earned from a job

• Money given as a gift

Who is a lender?

• A person taking out a loan

• A person or business that loans money for a fee

• A person saving money

• A person spending money

What is interest?

• The cost charged for borrowing money

• The amount saved in a bank

• The money earned from a job

• The fee for opening a bank account