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Budgeting Study exam guide

Total questions: 15

Worksheet time: 8mins

Name
Class
Date
1.

Building a weekly meal plan around items you already own or items that are on sale that week, rather than just choosing foods you'd like to eat

a)

You put every dollar of your net pay into a budget category each month 

b)

You spend your checking account balance down to $0 every month 

c)

You spend your saving account balance down to $0 every month 

d)

You pay every one of your debts down to $0 every month 

2.

If you are trying to substantially reduce the amount you spend on food, you should try...  

a)

a.  Cooking your own food at home for as many meals as possible 

b)

b.  Dining at restaurants more often so you don't waste water doing dishes 

c)

c.  Eating more snacks on the go and way fewer meals at home 

d)

d. Drinking more coffee and soda so you are not as hungry for food 

3.

Dani does all her grocery shopping at organic markets and has a monthly grocery bill of $325. Dominic says that Dani is wasting her money on wants instead of focusing on needs. He buys in bulk, uses coupons, and shops at Save-More for a monthly bill of $195. Who's budgeting correctly for food? 

a)

Dani, because she is focusing on her health, which will have a guaranteed payoff in the long run 

b)

Both, because needs vs wants are determined on an individual basis 

c)

Dominic, because he's taking efforts to save money by focusing on his needs only 

d)

Neither, because they should meet in the middle somewhere. Dominic should focus more on health, and Dani should cut her spending.  

4.

You're considering moving into a 3 bedroom apartment with 2 roommates, rather than living on your own post-college. Which of your expenses would likely decrease by having roommates? 

a)

Groceries and eating out  

b)

Rent

c)

Cell phone bill

d)

bedroom furniture

5.

Which one of these expenses most likely represents a VARIABLE (to change)  cost in someone's budget?  

a)

Electricity bill

b)

Rent

c)

Car insurance premium

d)

student loan payment

6.

Now that Sumia is done with college, she is trying to decide whether or not she should buy a new laptop for herself. She has made a preliminary list of questions she can ask herself to determine if the new laptop is a need or a want. Which of the following questions would you ELIMINATE from this list? 

a)

Can I afford this laptop right now? 

b)

Is this the right time to buy this laptop or will it likely be on sale later? 

c)

What model laptop is trendy right now with people my age?  

d)

How am I going to pay for this laptop? If I have to charge it or take out a loan, can I afford the monthly payments? 

7.

All of the following are good budgeting strategies if you want to save money at the grocery store EXCEPT: 

a)

Focusing on unit price when comparing similar products 

b)

Building a weekly meal plan around items you already own or items that are on sale that week, rather than just choosing foods you'd like to eat 

c)

Focusing only on the price when comparing similar products 

d)

Preparing a grocery list before you go to the store and avoiding buying items that aren’t on the list 

8.

What action corresponds to the advice "Pay yourself first?" 

a)

Wait until the end of the month to determine how much you have leftover to save 

b)

Set aside a fraction of your paycheck into a savings account before you start spending 

c)

Spend your regular paycheck on needs and wants but funnel any extra money into saving 

d)

Become self-employed so you're paying yourself instead of being paid by an employer  

9.

Which of these costs would be the MOST difficult to adjust if you were looking to reduce your expenses? 

a)

Dining out at local restaurants 

b)

Loan payment on a new car 

c)

Expenses for new clothes

d)

Postponing a purchase for a big-screen TV 

10.

For two months in a row, Aaron realizes he has a budget deficit of roughly $175. Which of these options makes the most sense for him to fix his problem? 

 

a)

Cancel one of his streaming video subscriptions and go out to dinner three fewer times each month with friends 

b)

Start paying just the minimum monthly payment on his student loan and credit card debt, instead of the extra he's been contributing 

c)

Contribute $100 less to savings each month and $75 less to his retirement fund 

d)

Sell his current car and get a less expensive vehicle 

11.

You overhear your cousin talking about the importance of creating and sticking to a budget. All of the following are good reasons to create and stick to a budget EXCEPT:V

a)

A budget can help you identify any bad spending habits

b)

using a budget can allow you to work towards your financial goals

c)

Having a budget can help you create an emergency fund

d)

having a budget is a requirement for obtaining a mortgage

12.

Which of these boxes of cereal has the LOWEST unit price?  

a)

Cereal A, which costs $3.20 for a 16 oz. box 

b)

Cereal B, which costs $5.00 for a 32 oz. box 

c)

Cereal C, which costs $2.50 for a 10 oz. box 

d)

Cereal D, which costs $4.50 for an 8 oz box 

13.

Which statement accurately describes how the 50/20/30 Rule would break down your take-home pay?

a)

50% on wants, 20% on saving, and 30% on needs 

b)

50% on saving, 20% on needs, and 30% on wants 

c)

50% on needs, 20% on saving, and 30% on wants 

d)

50% on saving, 20% on wants, and 30% on needs 

14.

You are putting together your first post-graduation budget.  Your net pay (take home pay) is $2,500 per month and you estimate that your monthly expenses will be $2,625.  How would you describe your budget? 

a)

. You have a surplus of $125

b)

You have a deficit of $125

c)

You have a deficit of $2,625

d)

You have a surplus of $2,500

15.

shrinkflation is when:

a)

a. Companies increase the quantity of a product and the price stays the same 

b)

b. Companies reduce the quantity of a product but the price stays the same 

c)

Grocery stores put high priced items at eye level and lower cost items above or below eye level 

d)

The price of items gets smaller