WorksheetsMoney Matters - 1st Semester Exam
Total questions: 55
Worksheet time: 5hrs 35mins
You should always make sure you have a...
Budget
Credit line
Direct deposit
Credit card
What is the first foundation?
pay cash for college
build wealth and give
save a $500 emergency fund
open a checking account
Personal finance is all the financial decisions a(n) ______ must make in order to earn, budget, save, spend, and give money over time.
individual or family
company or organization
individual or company
bank
Avoiding debt can lead to financial freedom and home.
True
False
After World War 1, the demand for products increased, and people began getting credit without loan sharks. Because of this, credit...
started to become more socially acceptable
increased so rapidly, loan sharks became obsolete
was offered at even higher interest rates by loan sharks
was devalued in the marketplace
A money principle to keep in mind is to live on _____ than you make.
exactly 20% below what
more than
the same as
less than
To know your net worth, subtract your liabilities from your _____.
other liabilities
net income
previous net worth
assets
What is the best way to avoid running out of money too quickly?
you can make it a habit to plan and set goals for your money
you can avoid making any purchases for the next 30 days
you can put your money in a safe place, like a bank, and not spend it
you can invest in college
An important money principle to consider is that you should _____ and _____ your money.
invest; lay out
save; invest
spend; invest
invest; endow
If you assets total more than your liabilities, you will have a(n) _____ net worth.
negative
equal
positive
unknown
When you set financial goals, they should be...
timely, bank-based, specific, and yours
specific, measurable, time-sensitive, yours, and written
specific and measurable
only time-sensitive
Using credit has not always been a socially accepted practice, but it has become...
less acceptable
a practice used by the wealthy
necessary for life in America
normal in American culture
A _____ financial goal takes up to 2 years to reach.
five-level
short-term
medium-term
long-term
What is the 5th Foundation?
pay cash for your car
get our and stay our of debt
find a financial professional
build wealth and give
What is financial literacy?
understanding and effectively using various financial skills
the ability to read financial statements
knowledge of global financial markets
expertise in investment banking
What is a budget?
spending your money
a plan for your money
going to the bank
a list of expenses
Although the majority of Americans think budgeting is important, about _____ of Americans actually use a budget.
75%
50%
23%
35%
Which of the following is NOT a component of a budget?
credit score
saving
income
giving
What are the four walls?
utilities, college fund, restaurants, and car insurance
cell phone bill, car insurance, shelter, and money for the movies
food, utilities, transportation, and college fund
food, utilities, shelter, and transportation
How often should you create a budget?
daily
weekly
monthly
biannually
Detailed categories on your budget will help you make better spending decisions.
True
False
Research shows that nearly half of Americans (46%) feel stress and anxiety about the amount of _____ they have.
money
categories in their budget
debit cards
personal debt
Going to the movies is an example of what types of expenses?
intermittent and variable
discretionary and fixed
discretionary and variable
intermittent and fixed
Net income is the amount you get paid before taxes.
True
False
Why is tracking your expenses throughout the month important?
it allows you to delete categories you don't likeq
it gives you insight into whether you're sticking to the budget you set
it helps you pull money from your savings to spend in other categories
it really isn't that important in the long run
What kind of money counts as income?
only the money you make at your job
all money that you receive, including money from your job and gifts like birthday money
money in your savings account
only money deposited into your bank account
Commission is when you make money based on the percentage of _____.
total sales
investments
budgets
items sold
Your monthly rent payment is an example of a variable expense.
True
False
Which of the following best explains the difference between a fixed expense and a variable expense?
a fixed expense remains constant each month, like rent, while a variable expense can change, like utility bills.
a fixed expense can change each month, like groceries, while a variable expense remains constant, like a subscription service.
Both fixed and variable expenses remain constant each month.
Both fixed and variable expenses change each month.
Which of the following best describes irregular income?
income received at regular intervals
income that varies in amount and frequency
income that is fixed and predictable
income that is tax-free
Once you have a $500 emergency fund, you should...
start putting it toward debt
invest it in the stock marker to grow your money
save it until you have an emergency
use the money to pay for health insurance
Why do some accounts, like savings accounts at your local bank, earn interest
because you deposit money, adding to your principal each month
because the bank pays you to use your money
because those accounts always have great interest rates
because of inflation
Which 2 habits are the most important for building wealth and becoming a millionaire?
working a high-paying job and relying on a trust fund
always paying off your credit card on time and putting extra money into a retirement account
investing into the right stocks and using a private CPA
consistently investing money and giving it time to grow
The interest rate on a savings account determines...
how much money you need to have to open the account
how much you will pay the bank to manage the account
the amount of time your money will be in the account
how quickly your money will grow over time
_____ is a millionaire's best friend.
accrued interest
compound growth
high returns
profit sharing
What is the goal of an emergency fund?
to pay for large purchases
to save for your children's college expenses
to have cash on hand for unexpected events
to pay for health insurance
What is the 3rd Foundation?
pay cash for your car
pay cash for college
save for retirement
create a monthly budget
The amount of interest charged on a debt but not yet collected is called...
accrued interest
interest rate
compound interest
growth rate
Which of the following is an effective strategy for personal saving?
Wait until the end of the month and save whatever is left in your checking account
Save a certain percentage of each paycheck and deposit it directly into a savings account
Cover all of your wants and needs and save whatever is left over
Take out a payday loan so you can save before you receive your paycheck
What is the recommended percentage of income to save for retirement?
5
10
15
25
Definition: income that comes in at different amounts or at different times, or both
irregular income
net income
variable expense
gross income
Definition: expense for things you don't need
variable
discretionary
intermittent
fixed
A cash flow plan that assigns an expense to every dollar of your income, wherein the total income minus the total expenses equals zero.
zero-based budget
net income
irregular income
variable expense
The amount you earn before taxes and other payroll deductions.
variable expense
net income
irregular income
gross income
The measure of an investment's profit or loss, usually expressed as a percentage of the initial investment.
compound interest
rate of return
interest rate
time value of money
The average rate of growth for an investment over time; often expressed as an annual figure
inflation
compound growth
interest rate
compound interest
The initial amount of money invested or borrowed
inflation
principle
compound interest
interest rate
The persistent rise in the cost of goods and services over time
recession
inflation
compound growth
time value of money
Interest paid on interest previously earned.
inflation
interest rate
compound interest
compound growth
What is the primary benefit of having a diversified investment portfolio?
It eliminates the need for a financial advisor.
It reduces risk by spreading investments across various assets.
It guarantees high returns.
It ensures tax-free income.
Which of the following is a key characteristic of a good budget?
It is flexible and can be adjusted as needed.
It is rigid and cannot be changed.
It only includes fixed expenses.
It is created once and never reviewed.
What is the main purpose of setting up an emergency fund?
To pay for luxury vacations.
To invest in high-risk stocks.
To cover unexpected expenses without going into debt.
To lend money to friends and family.
What is the primary purpose of a budget?
To plan for future expenses and savings
To ensure you spend all your income
To avoid paying taxes
To track your spending habits
Which of the following is considered a fixed expense?
Groceries
Rent
Entertainment
Clothing
What is the benefit of having an emergency fund?
To invest in high-risk stocks
To pay off credit card debt
To cover unexpected expenses without going into debt
To buy luxury items
