Wise Study Questions part 2

Which of the following is considered earned income?

• Interest from a savings account

• Stock dividends

• Paycheck from a part-time job

• Inheritance

Which of the following is considered unearned income?

• Hourly wages

• Tips

• Gift money

• Commission

Gross pay is defined as:

• Your pay after taxes and deductions

• The total amount you earn before taxes and deductions

• Income from a second job

• Money earned from investments

Net pay should be used for budgeting because:

• It includes your bonus

• It's your total pay before taxes

• It's the amount you actually take home

• It reflects your gross income

Which of the following is NOT a common payroll deduction?

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Which of the following is a NEED, not a WANT?

• Designer sneakers

• Streaming subscription

• Rent payment

• Concert tickets

Why is it important to distinguish between needs and wants when budgeting?

• Wants are always cheaper

• Needs should be prioritized in spending

• Wants help you save money

• You should never spend money on wants

Which is the correct order of steps in creating a budget?

• Set goals → Spend → Review expenses

• Track income → Set goals → Pay bills → Adjust as needed

• Spend freely → Save later

• Buy needs → Buy wants → Track income

Fixed expenses are:

• Different every month

• Optional spending

• The same every month

Which of the following is a variable expense?

• Car loan

• Monthly rent

• Cell phone plan

• Grocery bill