WorksheetsFinancial Literacy MC 1 Dec 4
Total questions: 50
Worksheet time: 25mins
A debit card transaction:
Creates a loan
Has no spending limit
Withdraws money directly from your account
Builds credit
The Rule of 72 helps estimate:
How long it takes money to double
How to avoid taxes
How much insurance to buy
Minimum wage
A secured loan requires:
Home ownership
A cosigner
Collateral
No identification
Which account typically has the highest interest rate?
Checking account
Savings account
Certificate of Deposit (CD)
Prepaid debit card
Which action helps build credit?
Maxing out credit cards
Making on-time payments
Applying for many loans
Missing one payment
The NCUA insures:
Banks
Credit unions
Pension funds
Stock investments
ATM skimming involves:
Removing bank fees
Stealing card information
Transferring money
Deposit holds
Savings grows fastest because of:
Number of deposits
Compound interest
Spending limits
Debit card rewards
A checking account is best for:
Long-term investing
Daily transactions
Retirement
Real estate
Primary purpose of insurance:
Increase income
Reduce financial risk
Improve credit
Eliminate taxes
A money order is similar to a:
Payday loan
Certified check
Credit card
Money market account
The principal refers to:
Interest earned
Original amount deposited
Annual fee
Loan term
A W-2 form shows:
Job duties
Income & taxes withheld
Hours worked
Insurance coverage
Minimum payments on a credit card:
Reduce interest
Pay off the balance quickly
Extend time to repay
Increase your credit score
A deductible is:
Amount insurance pays first
Your out-of-pocket cost before insurance pays
Monthly premium discount
A government penalty
The safest method to send money is:
Mailing cash
Wire transfer
Using an unlocked mobile app
Sending gift cards
APY stands for:
Annual Percentage Yield
Average Payment Year
Annual Penalty Yield
Accrued Payment Year
Liquidity refers to:
Risk level
How fast an asset becomes cash
Tax deductions
Credit limits
A credit utilization ratio compares:
APR to APY
Debt used to credit available
Taxes to wages
Debit use to ATM use
A bank statement does NOT show:
ATM fees
Withdrawals
Deposits
Outstanding checks
The purpose of a check register is to:
Track investments
Record deposits & withdrawals
Track taxes
Increase interest
Higher deductibles usually result in:
Higher premiums
Lower premiums
More coverage
More claims
Grace period refers to:
Extra paycheck time
Time to pay credit card bill without interest
Loan penalties
Savings account bonus period
What is needed to open a checking account?
Tax return
Government-issued ID
High credit score
Car insurance
A 1099 form reports:
Contractor income
Mortgage interest
Employment wages
Property taxes
Life insurance benefits:
Decrease taxes
Replace income after death
Pay student loans
Boost credit
Paying the full credit card balance each month:
Raises APR
Avoids interest
Lowers credit score
Increases loan limits
A cosigner:
Has no responsibility
Pays if borrower fails
Must be a parent
Lowers interest automatically
If interest rates rise, which benefits most?
Fixed-rate CD
Checking account
Variable-rate savings
Gift cards
Most important factor in credit scores:
Age
Payment history
Types of credit
Taxes paid
A premium is:
Total coverage
Monthly insurance payment
Deductible
Copay
A prepaid debit card:
Builds credit
Requires a bank account
Is loaded with money before use
Provides loans
Overtime pay is usually:
Regular wage
1.5x regular wage
Double time
Unpaid
Which is LEAST liquid?
Cash
Savings account
Money market account
Certificate of Deposit (CD)
A routing number identifies:
A person
A specific bank
Location of ATM
Auto loan issuer
A money market account usually requires:
No ID
High minimum balance
Unlimited withdrawals
No statements
Term life insurance covers you for:
Your entire life
A specific period
Until age 100
Until retirement
Filing taxes late usually leads to:
Lower taxes
Penalties
Higher wages
A refund
Which tax is progressive?
Sales tax
Federal income tax
Gas tax
Property tax
Auto liability insurance covers:
Damage to your own car
Damage/injury you cause to others
Your lost wages
Roadside assistance
A CD penalty happens when:
You over-deposit
You withdraw early
You miss a loan payment
You overdraft
A copay is:
Premium
A fixed amount paid for doctor visits
A tax refund
A deductible
A W-4 form determines:
Your income
How much tax is withheld
Your credit limit
Your insurance rate
Bankruptcy stays on a credit report for:
1 year
3 years
7-10 years
20 years
Interest is charged on a credit card when:
You pay in full
You carry a balance
You use a debit card
You deposit money
A paycheck stub shows:
Grades
Hours, deductions, net pay
Taxes owed next year
Bank account balances
CD means:
Call deposit
Certificate of Deposit
Cash document
Checking draft
Renters insurance covers:
The building
Your belongings in a rental home
The landlord
Mortgage loans
Which helps money grow fastest?
Simple interest
Compound interest
ATM withdrawals
Minimum payments
Overdraft means:
Depositing too much
Spending more than you have
Using a credit card
Paying early
