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WorksheetsFinancial Literacy Pre-Run Activity
Total questions: 36
Worksheet time: 47mins
Choices have to be made because:
costs are limited.
wants are limited.
resources are limited.
consequences are limited.
The phrase "There's no such thing as a free lunch," refers to the fact that:
the use of resources has a cost.
shortages are good for consumers.
discount coupons reduce prices to zero.
wants are limited and resources are unlimited.
Suppose a local government decides to spend more of its funds on public school education and less on roads. This situation illustrates which point about the economic ways of thinking?
People's resources are unlimited.
People's wants are relatively limited.
Every choice involves an opportunity cost.
The cost of a choice is greater than the benefit.
The opportunity cost of a decision is the:
money spent making the decision.
worst choice that could have been made.
value of the next best alternative not chosen.
total benefits expected from all forgone opportunities.
Which is an example of the effect of an economic incentive?
assisting the poor to help others
buying something because it is on sale
exercising at the gym to feel physically fit
giving up a part-time job to have more time with friends
A $400 tax is placed on all sports cars and this increases the price of sports cars. The economic way of thinking suggests that:
fewer sports cars will be sold.
more sports cars will be sold.
the production of sports cars will cease.
the production of sports cars will be more profitable.
Which is a primary reason for planning and thinking before buying something?
to reduce your income
to encourage impulse spending
to make decisions in the fastest way possible
to get the item that best satisfies your wants
Which is the first step on the decision making process?
Identify the goals.
State the problem.
List the alternatives.
Evaluate the alternatives.
Roxie ordered a hamburger after quickly looking at the menu. Later, she found out the restaurant offered Reuben sandwiches, and she wished she had ordered one. Which step of the decision making process did Roxie do a poor job of following?
knowing the problem
identifying the criteria
evaluating the alternatives
identifying the alternatives
Sally can shop at two grocery stores. The closest one to her has less variety and higher prices, while the farther one has more variety and lower prices. Sally shops at the closest one. Which factor did Sally give the most weight to in her decision?
low prices
more variety
a near location
the number of stores
You are employed, but your income is low because you have few job skills. What would be the best action to take to increase your income?
Get more training.
Apply for a credit card.
Stay with the current job.
Look for another similar job.
How do education and job experience generally affect the productivity of a worker?
Education and job experience have no effect on productivity.
Job experience and education generally increase productivity.
Education increases productivity but job experience does not.
Job experience increases productivity but education does not.
Compared with most employees, entrepreneurs:
work fewer hours.
work better in teams.
are more willing to take risks.
are more willing to take government aid.
Entrepreneurs are considered innovators because they:
pay more taxes.
work long hours.
take dangerous jobs.
create new products.
Goods produced for the purpose of making other goods and services are called:
stock goods.
credit goods.
capital goods
consumer goods.
The main reason that businesses update their machinery and equipment is to:
keep their employees.
impress their customers.
raise their cost of production.
increase worker productivity.
Which is a way to increase productivity?
hiring workers
training workers
selling equipment
decreasing wages
One way to develop human capital is to:
purchase bonds.
gain job experience.
sell new equipment.
increase worker wages.
Which is the correct general relationship between education level and unemployment?
Higher Unemployment: college graduate
Lower Unemployment: high school diploma only
Higher Unemployment: college graduate
Lower Unemployment: high school dropout
Higher Unemployment: high school dropout
Lower Unemployment: college graduate
Higher Unemployment: high school diploma only
Lower Unemployment: high school dropout
What is the opportunity cost of dropping out of school before your high school graduation?
higher wages in the future
freedom to do what you want right now
what you earn working after you drop out
no expenses for textbooks and school supplies
What is the opportunity cost of saving money?
the value of the interest on the savings
the products that could be purchased now
the possible loss of the savings in case of theft
taxes that will have to be paid on the savings and earned interest
Which form of payment for a purchase may incur fees if the balance is not paid by the due date?
check
currency
debit card
credit card
Mike used his credit card to buy a tie at The Shirt Shop for $20. As a result of this transaction, the credit card company will:
loan Mike $20.
loan The Shirt Shop $20.
deduct $20 from Mike's checking account.
deduct $20 from The Shirt Shop's checking account.
Hector bought a new television for $500 and used his credit card to make the purchase. What is his opportunity cost from this purchase?
less money for future uses
more currency for making purchases
the convenience of not having to carry cash
interest that will be paid to Hector by the credit card company
Character, capacity, and collateral are considered to be the three key factors:
a lender uses for evaluating the risk of a loan.
an investor uses for making a stock purchase.
a borrower uses for determining the cost of a loan.
a saver uses for establishing a checking account.
Your credit line is the:
minimum amount available to borrow.
maximum amount available to borrow.
minimum monthly payment on a credit card.
maximum monthly payment on a credit card.
What will likely happen to collateral if a person fails to repay a loan?
It will be loaned by the lender.
It will be destroyed by the lender.
It will be purchased by the lender.
It will be repossessed by the lender.
People with a poor credit history will usually pay a:
higher inflation rate.
higher interest rate.
lower inflation rate.
lower interest rate.
Willie was lured to an electronics store that was advertising a great price for a DVD player the store knew it didn't have in stock. The clerk told him the store was out of that model, and showed him higher-priced models. What illegal marketing strategy was used in this case?
price fixing
pyramid sales
there and gone
bait and switch
For budgeting purposes, how would you classify the cost of repairing your car due to an accident?
fixed and planned expense
fixed and unplanned expense
variable and planned expense
variable and unplanned expense
You decide that you want to save 10 percent of each paycheck. You tell your bank to place 10 percent of each paycheck into your savings account. This strategy is called:
"pay yourself first."
"net worth analysis."
"collateral planning."
"living above your means."
If Jill writes a check for $500, but has only $450 in her checking account, this would be an example of:
a cash flow.
an overdraft.
a money order.
an automatic withdrawal.
A debit card and a direct deposit both involve:
selling and buying stocks in the marketplace.
the securing of credit and payment of interest.
electronic transfers to or from your checking account.
transaction fees regardless of where the transaction occurred.
The PIN required for an ATM card and a debit card is a measure to:
prevent fraudulent use of the card.
transfer money from one account to another.
allow you to compound interest more frequently.
assure you make no overdrafts on your account.
Which is a deduction made from the wages you receive from a job?
a sales tax
an excise tax
an income tax
a property tax
A federal program to provide the elderly with some retirement income and to assist the minor children of a parent who has died is:
Social Security.
food stamps.
Medicare.
Medicaid.
