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WorksheetsPersonal Finance - Final Exam
Total questions: 55
Worksheet time: 28mins
Name
Class
Date
1.
A bicycle that normally sells for $150 is on sale for 20% off. How much is the bicycle after the discount?
(a)
2.
If sales tax is 6%, how much sales tax must you pay on an oven that costs $300?
(a)
3.
Which of the following best describes discretionary spending?
a)
Discretionary spending refers to the money available after taxes are removed and any mandatory obligations have been covered.
b)
Discretionary spending is the same as net income.
c)
Discretionary spending refers to the money that must be paid.
d)
Discretionary spending refers to the money spent at a person’s own discretion, specifically on food or entertainment.
4.
Which of the following best describes intrinsic value?
a)
The price at which an item is bought or sold for
b)
The value an individual gives an item for personal reasons
c)
An item’s worth in comparison to something else
d)
The extent to which a person wants or needs an item
5.
Which of the following best describes relative value?
a)
The price at which an item is bought or sold for
b)
The value an individual gives an item for personal reasons
c)
An item’s worth in comparison to something else
d)
The extent to which a person wants or needs an item
6.
What is the key to long-term budgeting success?
a)
Establishing the budgeting habit first, then adjust the spending habits
b)
Monitoring spending and adjust it as appropriate
c)
Adjusting spending habits then set a budget based on the adjustments
d)
Including bills in budgeting plans
7.
Which of the following is NOT true for the envelope budget?
a)
It utilizes the psychological advantages of paying with cash.
b)
Most, if not all, discretionary spending is done with cash.
c)
If a person uses a credit or debit card, he will most likely spend less money than if he used cash.
d)
Using cash instead of a card naturally limits spending.
8.
Government student loans can be subsidized and unsubsidized. Which of the following best describes the primary difference between them?
a)
Subsidized loans will always have smaller payments than unsubsidized loans.
b)
Unlike unsubsidized loans, payments on subsidized loans are tax deductible.
c)
They both charge interest, but the government pays the interest on subsidized loans while the student is in school.
d)
If a student receives grant money, their loans are considered subsidized by the grant itself.
9.
What does the acronym FAFSA stand for?
a)
Federal Association for Financing Student Academics
b)
Free Application for Federal Student Aid
c)
Free Aid for Financial Student Assistance
d)
Federal Application for Free Student Aid
10.
The budgeting process includes three important aspects. Which of the following describes the most important aspect?
a)
Categorizing spending needs because they must be a top priority
b)
Categorizing spending wants because they result in dangerous spending
c)
Assigning limits to categories because budgets are built on limitations
d)
Committing to the limits and categories decided on
11.
Which of the following is a fixed expense?
a)
Mortgage Payment
b)
Groceries
c)
Gasoline
d)
Entertainment
12.
Which of the following is a variable expense?
a)
Rent
b)
Cable/Internet
c)
Gasoline
d)
Loan Repayment
13.
Which of the following is a major advantage that comes from paying for things with cash?
a)
Spending is limited to available cash.
b)
Excessive spending is more likely to occur if a larger bill must be broken for a minor purchase.
c)
People tend to buy more things when using cash.
d)
If a person runs out of cash, she can easily make a withdrawal at an ATM.
14.
Which of the following is a common non-monthly expense that could be included in a monthly budget?
a)
Electric bill
b)
Rent
c)
Gasoline
d)
Car Maintenance
15.
Which of the following is not considered a type of college financial aid?
a)
Federal Pell Grants
b)
Subsidized loans
c)
Job reimbursements
d)
Tuition waivers from a college department
e)
Personal savings
16.
All of the following are true about why it is important to complete the FAFSA process EXCEPT:
a)
It allows you to be eligible for federal student aid.
b)
It allows you to be eligible for early admission.
c)
It allows you to be eligible for some grants.
d)
It allows you to be eligible for many scholarships.
17.
*When calculating Return On Investment (ROI), first find the benefit. Which of the following best describes the benefit?
a)
The total amount of money made on a deal
b)
The amount of money made after paying back the initial investment
c)
The amount of money put into an investment to begin with
d)
Revenue
18.
Which of the following is true about the FAFSA?
a)
Money is awarded on a first-come, first-served basis.
b)
You must use your parents' tax information unless you are married
c)
You must use your parents' tax information unless you are 24 years old
d)
All of these are correct
19.
Which of the following describe what a "dependent" is for tax purposes?
a)
Someone who is temporarily disabled
b)
Someone who financially supports you
c)
Someone who is a full-time student under the age of 30
d)
Someone under the age of 19 who you financially support
e)
all of these are true
20.
Find the Simple Interest earned with the following: Principal Amount: $18,000 Interest Rate: 3.5% Term: 5 years
a)
$19,400
b)
$3,150
c)
$3,081
d)
$4,421
21.
Which of the following best describes the snowball method for paying off debts?
a)
The principal amount of debt gets bigger as each debt is consolidated into a new one.
b)
Debt is paid off faster, as all the extra money is evenly spread out over each debt.
c)
The amount of extra money paid toward debts gets bigger as each debt is paid off, and the payment amount is added to the next debt.
d)
Paying off the biggest debt takes a long time, but the amount of money available for the next debt becomes greater and momentum increases.
22.
Which of the following is not one of the 3 steps to financial freedom?
a)
Invest your money
b)
Build an emergency fund
c)
Use the snowball method
d)
Establish a crisis fund
23.
Sam has decided to pay $50 EXTRA each month toward her loans. What amount of the $50 will go toward the principal amount and what amount goes toward interest?
a)
100 percent to principal, 0 percent to interest
b)
50 percent to principal, 50 percent to interest
c)
The same ratio as that month’s regular payment
d)
It depends on the bank.
24.
How much money should you have in your EMERGENCY fund (not a crisis fund)?
a)
$1,000
b)
$5,000
c)
1-2 Months of Expenses
d)
3-6 Months of Expenses
25.
Which of the following statements about this W-2 is true?
a)
Lily paid state income taxes of $1,189.90
b)
Avia Consulting will use this W-2 to file their 1040 form
c)
Lily earned about $117,000 over the year based on the total of her Wages, Social Security wages, and Medicare wages
d)
Lily works in the same city that Avia Consulting is based in
26.
Your friend Laila is talking to you about the benefits of tax filing software. Which of the following is true?
a)
Filing your taxes using the software is always free of charge.
b)
You are guaranteed a higher refund than if you were to use a paper form or hire a professional.
c)
You are 50% less likely to make a mistake when e-filing your taxes than if you were to file them using paper forms.
d)
You can avoid the costs of having to pay a professional, though you may have to pay for the software and/or e-filing online.
27.
How much interest will you owe if you pay off your entire credit card balance each month?
a)
None
b)
Half the normal amount
c)
The normal amount
d)
It will be prorated based on the day you pay it off
28.
What is one difference between actively managed mutual funds and index funds?
a)
Actively managed mutual funds typically have higher fees than index funds do
b)
Actively managed mutual funds invest in less risky investments than index funds
c)
Actively managed mutual funds track the performance of a single stock and bond while an index fund follows an index
d)
Actively managed mutual funds guarantee the average return of the securities in the fund while index funds aim to beat the market
29.
(Miles driven / mpg) x gas prices = ?
a)
Miles driven
b)
Fuel costs
c)
Car maintenance
d)
Monthly car loan payment
30.
Which of the following is a major cost of vehicle ownership?
a)
Insurance
b)
Fuel
c)
Repairs
d)
Maintenance
e)
All of these are correct
31.
When a person owes more on a car than it is worth, what does that mean?
a)
Right side up
b)
Upside down
c)
Sideways
d)
Depreciation
e)
Appreciation
32.
Which of the following maintenance issues is most likely going to be the responsibility of the landlord not the tenant?
a)
Cleaning when tenant moves out
b)
Replacing a fridge filter
c)
Replacing tiles in the kitchen
d)
Hole in the carpet from the dog
e)
Changing the lightbulbs
33.
Which of the following up-front lease expenses is most likely to not be refunded?
a)
First month’s rent
b)
Last month’s rent
c)
All of these are correct
d)
Application fees
34.
How does insurance help consumers?
a)
Shift financial liability
b)
Make money
c)
Provide a service
d)
Shifts financial risk
35.
Liability Insurance...
a)
Pays for injury to another driver and/or damage to their car if you are in an accident
b)
Pays for non-accident damages
c)
Covers damage to your vehicle from an accident
d)
Covers damage to your vehicle if the driver at fault doesn’t have minimum insurance requirements
36.
The agreement of what will be paid by you and what will be paid by insurance is:
a)
A deductible
b)
An insurance policy
c)
An insurance premium
d)
Co-insurance
37.
The portion of a claim that a person must pay before her insurance company contributes is called:
a)
A deductible
b)
An insurance policy
c)
An insurance premium
d)
Co-insurance
38.
The money paid for an insurance policy is:
a)
A deductible
b)
An insurance fee
c)
An insurance premium
d)
Co-insurance
39.
Which of these items is important to consider when selecting a credit card?
a)
The look of the card
b)
Interest Rate
c)
Fees
d)
Interest Rate and Fees
40.
Which of the following is a benefit of having a good credit score?
a)
You will get discounts at local stores
b)
Your interest on loans and credit cards will be lower
c)
You will earn a higher salary
d)
You'll get accepted to better education institutions.
41.
Credit cards can help _____________ when paid off on time regularly.
a)
build credit history
b)
check your credit score every week.
c)
have credit monitoring.
d)
have many open credit cards.
42.
Which of the following will NOT help you protect yourself from identity theft and fraud?
a)
Regularly monitor your credit report.
b)
Contact lenders and credit bureaus to address incorrect information.
c)
Freeze your credit.
d)
Waiting for someone to contact you
43.
How does paying the minimum payment every month give credit card companies the most money?
a)
Customers are able to pay off their debt faster
b)
Customers are never able to pay off their debt
c)
Customers are on time every month and paying the most in interest
d)
Customers who never pay are their most profitable customers
44.
April 15 is the date that:
a)
W-2’s come out
b)
Taxes are normally due
c)
You need to complete your W-4 by
d)
It depends on the state you live in
45.
Form W-2 is:
a)
Used to declare filing status, dependents, and other withholdings to your employer
b)
Used to declare your earnings and tax obligation to the IRS
c)
Given by your employer to show your earnings and withholdings from your paychecks
d)
All of these are correct
46.
Form 1040 is:
a)
Used to declare filing status, dependents, and other withholdings to your employer
b)
Used to declare your earnings and tax obligation to the IRS
c)
Given by your employer to show your earnings and withholdings from your paychecks
d)
All of these are correct
e)
None of these are correct
47.
How is taxable income calculated?
a)
Earned income + unearned income - deductions
b)
Wage x hours worked
c)
Earned income - deductions
d)
Unearned income - deductions
48.
A person’s filing status and taxable earnings helps determine what:
a)
How much a person can afford to pay on a car loan
b)
How much a person gets paid per month
c)
How much in exemptions a person can have from their taxes
d)
The amount of money a person is required to pay the government in taxes
49.
Which of the following is a main cost associated with home ownership?
a)
Utility Bills
b)
Groceries
c)
Size of a garage
d)
Health Insurance
50.
This type of mortgage changes periodically - fixed at a lower rate initially and then adjusts annually.
a)
Adjustable-rate mortgage
b)
Fixed-rate mortgage
c)
Depreciating-rate mortgage
d)
FHA-rate mortgage
51.
What does getting “pre-qualified” for a loan mean?
a)
The bank will determine if they are eligible for a loan based on their current residence
b)
The bank will determine if each person qualifies for a loan or if only one of them qualifies
c)
The bank will determine the amount it is willing to loan them based on their income and credit scores
d)
The bank will compare the house they want to buy with the house they live in and determine the loan amount based on relative values
52.
Depreciation on a home means:
a)
When the value increases over time
b)
When the cost of the home is greater than a person’s income
c)
When the value decreases over time
d)
When the cost of the home is lower than a person’s income
53.
Investing allows you to _____ while saving is best for ____.
a)
Accumulate wealth; short-term purchases and emergencies
b)
Short-term purchases and emergencies; accumulate wealth
c)
Get money no matter what; long-term investments
d)
Earn between 1-2%; earning between 5-7%
54.
What is the primary purpose of a W-4 form?
a)
To declare your earnings and tax obligation to the IRS
b)
To declare filing status, dependents, and other withholdings to your employer
c)
To report your annual income to the state tax authority
d)
To apply for a tax refund
55.
What is the main benefit of having a high credit score?
a)
Lower interest rates on loans and credit cards
b)
Higher interest rates on savings accounts
c)
More frequent credit card offers
d)
Increased likelihood of tax audits
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