Understanding Personal Assets and Liabilities

What is the definition of net worth?

• The total amount of money you earn in a year.

• The difference between your total assets and total liabilities.

• The total value of your investments.

• The amount of money you have in your savings account.

Which of the following is considered a personal asset?

• A car loan.

• A credit card balance.

• A house you own.

• A student loan.

• $3,000

• $5,000

• $13,000

• $7,000

Which of the following is a liability?

• A savings account.

• A mortgage.

• A piece of jewellery.

• A retirement fund.

• $30,000

• $70,000

• $20,000

• $50,000

Which of the following would increase your net worth?

• Taking out a new car loan.

• Paying off your credit card debt.

• Buying a new television on credit.

• Increasing your student loan.

What is the primary purpose of calculating net worth?

• To determine your annual income.

• To assess your financial health.

• To calculate your monthly expenses.

• To find out your credit score.

Which of the following is NOT considered an asset?

• Cash in hand.

• A personal loan.

• Stocks and bonds.

• Real estate property.

If you sell an asset for more than its purchase price, what is the financial term for the profit made?

• Depreciation.

• Capital gain.

• Net loss.

• Amortisation.

Which of the following is an example of a depreciating asset?

• A piece of land.

• A new car.

• A rare painting.

• A gold necklace.