Budgeting Unit Review Quiz

What does creating a budget involve?

• Spending all income

• Creating and adjusting a budget based on a salaried income

• Ignoring financial goals

• Only saving money

What is a fixed expense?

• An expense that varies each month

• An expense that is optional

• An expense that remains the same each month

• An expense that is paid annually

What is a cash envelope budget?

• A digital budgeting method

• A method where cash is allocated into envelopes for different spending categories

• A method that uses credit cards for all expenses

• A method that involves only online transactions

What is an emergency fund?

• Money set aside for vacations

• Money set aside for unexpected expenses

• Money set aside for luxury items

• Money set aside for regular bills

What does 'pay yourself first' mean?

• Spend money on wants before needs

• Save a portion of income before spending on anything else

• Pay all bills before saving

• Spend all income before saving

What is a zero-based budget?

• A budget where every dollar is assigned a purpose

• A budget with no savings

• A budget with no expenses

• A budget that ignores income

What is the cost of living?

• The amount needed for luxury items

• The amount needed to cover basic expenses like housing and food

• The amount needed for entertainment

• The amount needed for travel

If you spend more money than you earn, what type of budget do you have?

• Balanced budget

• Surplus budget

• Deficit budget

• Flexible budget

What is the strategy called where individuals save a portion of their income before paying other expenses?

• Post-spending saving

• Pre-spending saving

• Preemptive saving

• Pay-yourself-first

What should you look at to understand how expensive it might be to live in an area?

• Cost of living

• Price index

• Expense ratio

• Budget analysis