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WorksheetsPersonal Finance PRE-TEST
Total questions: 25
Worksheet time: 1hrs 15mins
What is the main difference between a salary and an hourly wage?
Salary workers are paid based on hours worked, while hourly workers get a fixed amount per year
Hourly workers are paid for each hour worked, while salary workers earn a fixed amount annually
Salary workers earn more than hourly workers
Hourly workers get more benefits than salary workers
What type of tax is deducted from your paycheck to fund Social Security and Medicare?
Income tax
Property tax
Payroll tax
Sales tax
Which of the following is an example of passive income?
Working part-time at a store
Investing in rental properties
Babysitting on weekends
Driving for a rideshare service
What does the 50-30-20 rule recommend?
50% Savings, 30% Fun, 20% Bills
50% Needs, 30% Wants, 20% Savings
50% Wants, 30% Needs, 20% Debt Payments
50% Bills, 30% Investments, 20% Fun
Fixed expenses are costs that:
Change every month
Stay the same each month
Are optional and can be cut from a budget
Only apply to businesses
Which of the following is an example of a variable expense?
Rent
Car payment
Groceries
Internet bill
What is the purpose of an emergency fund?
To pay for everyday expenses
To cover unexpected expenses like medical bills or car repairs
To invest in stocks
To buy luxury items
Experts recommend saving how much in an emergency fund?
At least $500
1 year’s worth of expenses
3-6 months’ worth of expenses
10% of your monthly income
What is the main benefit of compound interest?
You earn interest on both your original savings and the accumulated interest
It helps you avoid paying taxes
It reduces the amount of debt you owe
It guarantees high returns in a short time
What is the primary purpose of a checking account?
To save money for long-term goals
To hold money for everyday transactions
To invest in the stock market
To increase credit score
What is one major difference between a debit card and a credit card?
A debit card allows you to borrow money, while a credit card uses your own money
A credit card allows you to borrow money, while a debit card uses your own money
Debit cards help build credit scores
Credit cards do not charge interest
What does a credit score represent?
Your total income
Your financial reputation based on credit history
The amount of money in your bank account
How much debt you have
Which of the following will improve your credit score?
Making late payments
Paying your bills on time
Maxing out your credit cards
Opening multiple credit accounts at once
What happens if you only make the minimum payment on a credit card?
Your balance will be paid off quickly
You will avoid interest charges
You will pay more interest over time
Your credit score will automatically increase
What is impulse buying?
Carefully planning purchases
Buying something suddenly without planning
Comparing prices before purchasing
Shopping only with a list
Which is the best way to avoid impulse purchases?
Only use credit cards
Wait 24 hours before making a purchase
Always buy things on sale
Never go shopping
Which of the following is considered an investment?
Buying groceries
Purchasing company stocks
Paying a phone bill
Buying a new phone
What is diversification in investing?
Putting all your money into one stock
Spreading investments across different assets to reduce risk
Avoiding investments altogether
Investing only in real estate
What is a short-term financial goal?
Buying a house in 10 years
Saving for a vacation in 6 months
Retiring early
Paying off a 30-year mortgage
Lisa wants to buy a new laptop. She finds one for $800, but only has $500 in savings. What is the best financial decision for her?
Put the full amount on a credit card
Save up the remaining amount before purchasing
Borrow money from a payday lender
Buy a more expensive laptop
Sarah forgot to pay her credit card bill last month. What is the likely consequence?
Her credit score may drop
She will earn rewards points
She won’t be charged interest
Nothing will happen
If Jake spends more money than he earns every month, he is:
Living within his means
Budgeting well
Going into debt
Saving effectively
What is the best way to prepare for unexpected expenses?
Use a credit card for everything
Build an emergency fund
Take out a personal loan
Borrow money from friends
What is the Overtime Rate of pay?
Your hourly rate.
1 1/4 times your regular rate of pay
1 1/2 times your regular rate of pay
2 times your regular rate of pay
