Financial literacy; test questions and
answers already passed
Income - correct answer ✔✔ Any money that you receive
Sources of income - correct answer ✔✔ Salary
Allowance
Money from your birthday
Money from selling things
Interest earned from a savings account
Budget - correct answer ✔✔ A plan for managing your money during a given period of time.
Expense - correct answer ✔✔ What you spend your money on. (Needs and wants)
Fixed, variable, periodic - correct answer ✔✔ Fixed- those that cost the same every time
Variable- fluctuate in amount ( still may be able to estimate cost)
Periodic- expenses not paid all the time( both fixed and variable)
Deductions - correct answer ✔✔ Items subtracted from your paycheck
- taxes
- insurance
- retirement options
, Taxes - correct answer ✔✔ Federal income tax- fee collected by the government to support its
programs
State taxes- pays for state services
Social security tax- goes to elderly , disabled and orphaned
Medicare- elderly and disabled
Gross income - correct answer ✔✔ Refers to the total amount of income from your salary prior
to deductions. (Hourly rate x #of hours worked) x 52
Net income - correct answer ✔✔ Take homeboy amount. Money left after all deductions are
made by your employer (net income= gross income - total deductions)
Building a budget - correct answer ✔✔ Lost all money you have coming in
Make categories for all expenses
Subtract total expenses from income
Savings accounts - correct answer ✔✔ Safe place to store money you do not plan on using the
right way
Good for short/ medium term goals
Minimal fees
Earn interest
Take cash out quickly and without a penalty
Investing - correct answer ✔✔ Good for long term goals
More risk than a savings account
No guarantee your money will grow
Investments can rise and fall over time
answers already passed
Income - correct answer ✔✔ Any money that you receive
Sources of income - correct answer ✔✔ Salary
Allowance
Money from your birthday
Money from selling things
Interest earned from a savings account
Budget - correct answer ✔✔ A plan for managing your money during a given period of time.
Expense - correct answer ✔✔ What you spend your money on. (Needs and wants)
Fixed, variable, periodic - correct answer ✔✔ Fixed- those that cost the same every time
Variable- fluctuate in amount ( still may be able to estimate cost)
Periodic- expenses not paid all the time( both fixed and variable)
Deductions - correct answer ✔✔ Items subtracted from your paycheck
- taxes
- insurance
- retirement options
, Taxes - correct answer ✔✔ Federal income tax- fee collected by the government to support its
programs
State taxes- pays for state services
Social security tax- goes to elderly , disabled and orphaned
Medicare- elderly and disabled
Gross income - correct answer ✔✔ Refers to the total amount of income from your salary prior
to deductions. (Hourly rate x #of hours worked) x 52
Net income - correct answer ✔✔ Take homeboy amount. Money left after all deductions are
made by your employer (net income= gross income - total deductions)
Building a budget - correct answer ✔✔ Lost all money you have coming in
Make categories for all expenses
Subtract total expenses from income
Savings accounts - correct answer ✔✔ Safe place to store money you do not plan on using the
right way
Good for short/ medium term goals
Minimal fees
Earn interest
Take cash out quickly and without a penalty
Investing - correct answer ✔✔ Good for long term goals
More risk than a savings account
No guarantee your money will grow
Investments can rise and fall over time
