Financial Literacy Quiz

What is the purpose of a budget?

• To make spending more fun

• To track and control your income and expenses

• To avoid paying taxes

• To increase your credit score

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

• Groceries

• Entertainment

• Rent or mortgage

• Clothing

What does APR stand for in terms of credit cards or loans?

• Average Purchase Rate

• Annual Percentage Rate

• Accrued Payment Rate

• Automatic Payment Renewal

What is a credit score used for?

• To show how much money you have in the bank

• To determine your tax bracket

• To measure how good you are at saving

• To show how likely you are to repay debt

Which of the following is the best example of a want, not a need?

• Water

• Rent

• Designer sneakers

• Groceries

What does "pay yourself first" mean?

• Spend your paycheck before paying bills

• Treat yourself to a shopping spree

• Save a portion of your income before spending

• Pay off your credit cards last

What is an emergency fund?

• A) A loan you get in an emergency

• B) Insurance coverage

• C) Savings for unexpected expenses

• D) A bonus from your job

Which type of account typically earns interest?

• Checking account

• Savings account

• Cash in a wallet

• Gift card

What is the main benefit of compound interest?

• It lowers your monthly bills

• You earn interest on your interest

• It makes your debt disappear

• It's only available to adults

What is the safest way to build credit?

• Max out your credit card each month

• Never use credit

• Pay bills on time and keep balances low

• Open multiple loans at once