WISE Financial Literacy Review (Money, Banking, Credit)

Sources of income include wages, rentals, interest, capital, profits, investments, and _________?

• entrepreneurship

• transportation

• manufacturing

• education

What is an exemption (aka an allowance) and how does it work?

• An allowance is used to reduce the amount of taxed income.

• An allowance is a penalty added to your tax bill.

• An allowance is a bonus payment from your employer.

• An allowance is a fee paid to the government for tax services.

Liquidity—what does it mean?

• The degree of ease in which assets can be sold.

• The total value of a company's assets.

• The amount of profit a company makes.

• The process of borrowing money from a bank.

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

• Real estate

• Savings account

• Collectible art

• Retirement account

Gift cards can be part of a ________ loop system or an open loop system.

Discretionary income or budget surplus is income not allocated for ________ or ________.

• food or shelter

• entertainment or travel

• clothing or electronics

• savings or investments

A money order is a payment order for a pre-specified amount of money and is purchased at different types of stores.

• True

• False

Why does the U.S. currency have value even though it is not tied to a commodity?

• There is a belief that money has value and therefore is accepted.

• It is backed by gold reserves in Fort Knox.

• It is directly exchangeable for oil.

• It is made from precious metals.

Opportunity cost is the next best ________ when a choice is made.

• alternative

• expense

• resource

• benefit

Who is hurt the most and the least with inflation?