FHCE 3200 Module 2 UPDATED ACTUAL
Exam Questions and CORECT Answers
To accumulate wealth we need to: - CORRECT ANSWER invest our savings
In order to invest, we need to: - CORRECT ANSWER save money first
In order to save, our income needs to: - CORRECT ANSWER be greater than our expenses
income - expenses = - CORRECT ANSWER surplus (deficit)
savings rate = - CORRECT ANSWER savings / income
Good debt: - CORRECT ANSWER -mortgages, and the modest amounts of student loans
-does not negatively impact our credit score
-builds human capital
-increases the potential for greater income/wealth in the future
Bad debt: - CORRECT ANSWER revolving credit related debt
Too much income devoted to servicing debt prevents _________. - CORRECT
ANSWER savings
debt-to-income ratio: - CORRECT ANSWER (total required debt payments / gross income) X
100
What is a wage? - CORRECT ANSWER what an employer will pay an employee to complete
a task; almost all wages are based on an hourly rate
, Minimum federal wage: - CORRECT ANSWER $7.25
What is a salary? - CORRECT ANSWER a payment for a set period of time; can be 15 days,
1 month, or 1 year
What is a commission? - CORRECT ANSWER a payment based on the sale of a product or
service
wage + salary + commission = - CORRECT ANSWER earnings; can earn either or a
combination of all three
Fair Labor Standards Act - CORRECT ANSWER workers who fall under this must be paid at
least 1.5 times their regular wage when they word more than 40 hours in one week
Federal Rules allow a minimum wage of ______ for those who "customarily and regularly"
receive more than $30 in tips per month. - CORRECT ANSWER $2.13
Those who are on salaries are ____ required to paid extra time. - CORRECT ANSWER NOT
Self-Employed: - CORRECT ANSWER individuals work for themselves or in other words,
work for their own business or have a family run business; OR work an an independent or sub-
contractor to another business
True or False: self-employed individuals generate their income through their business -
CORRECT ANSWER TRUE
How do you know that you are employed or self-employed? - CORRECT ANSWER -if your
employer withholds FICA taxes from your pay check, you are an employee
-if your employer does not withhold FICA taxes than you are considered as being self-employed
by the IRS
Exam Questions and CORECT Answers
To accumulate wealth we need to: - CORRECT ANSWER invest our savings
In order to invest, we need to: - CORRECT ANSWER save money first
In order to save, our income needs to: - CORRECT ANSWER be greater than our expenses
income - expenses = - CORRECT ANSWER surplus (deficit)
savings rate = - CORRECT ANSWER savings / income
Good debt: - CORRECT ANSWER -mortgages, and the modest amounts of student loans
-does not negatively impact our credit score
-builds human capital
-increases the potential for greater income/wealth in the future
Bad debt: - CORRECT ANSWER revolving credit related debt
Too much income devoted to servicing debt prevents _________. - CORRECT
ANSWER savings
debt-to-income ratio: - CORRECT ANSWER (total required debt payments / gross income) X
100
What is a wage? - CORRECT ANSWER what an employer will pay an employee to complete
a task; almost all wages are based on an hourly rate
, Minimum federal wage: - CORRECT ANSWER $7.25
What is a salary? - CORRECT ANSWER a payment for a set period of time; can be 15 days,
1 month, or 1 year
What is a commission? - CORRECT ANSWER a payment based on the sale of a product or
service
wage + salary + commission = - CORRECT ANSWER earnings; can earn either or a
combination of all three
Fair Labor Standards Act - CORRECT ANSWER workers who fall under this must be paid at
least 1.5 times their regular wage when they word more than 40 hours in one week
Federal Rules allow a minimum wage of ______ for those who "customarily and regularly"
receive more than $30 in tips per month. - CORRECT ANSWER $2.13
Those who are on salaries are ____ required to paid extra time. - CORRECT ANSWER NOT
Self-Employed: - CORRECT ANSWER individuals work for themselves or in other words,
work for their own business or have a family run business; OR work an an independent or sub-
contractor to another business
True or False: self-employed individuals generate their income through their business -
CORRECT ANSWER TRUE
How do you know that you are employed or self-employed? - CORRECT ANSWER -if your
employer withholds FICA taxes from your pay check, you are an employee
-if your employer does not withhold FICA taxes than you are considered as being self-employed
by the IRS
