Economics: Financial Literacy

What does a "budget" help you do?

• Spend all your money

• Track your income and expenses

• Invest in the stock market

• Save money for a vacation

What is "saving money"?

• Spending all of your money immediately

• Keeping money for future needs or emergencies

• Investing in stocks

• Borrowing money from someone

What is the purpose of a "bank account"?

• To store your money safely

• To invest in the stock market

• To lend money to others

• To hide your money from the government

Which of the following is an example of a "fixed expense"?

• Buying a new phone

• Monthly rent or mortgage payment

• Buying clothes

• Going out to eat

What is the "interest" on a loan?

• The amount of money you borrow

• The amount of money you have saved

• The fee paid to the lender for borrowing money

• The cost of goods and services

What is "credit"?

• The ability to borrow money and pay it back later

• A savings account with no interest

• The amount of money in your wallet

• A type of investment that grows over time

What does it mean to "invest" money?

• To spend all your money on things you need

• To put money into something in hopes it will grow or earn more

• To keep your money in a savings account forever

• To borrow money to buy things now

What is a "credit score"?

• A score given by your bank for saving money

• A number that shows how well you manage debt and credit

• A measure of how much money you have saved

• The score you get on your tax return

What does the term "debt" mean?

• Money you earn from a job

• Money you owe to others

• Money you save in a bank account

• Money you spend on food and entertainment

Why is it important to have an "emergency fund"?

• To be able to buy a new car

• To pay for unexpected expenses like medical bills or car repairs

• To go on vacation

• To invest in the stock market