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Are You Financially Literate? Chapter 14 Quiz 1. Zac is making a budget. He made a lump sum estimate of his total income for the next 6 months. Then he lump sum estimated his expenses for the next six months. He subtracted the second lump sum from the first lump sum, and found that he had a budget surplus. Zac decided his budget was done and that he would be financially healthy in the next 6 months. What did Zac do wrong? Explain. _ ____________________________________________________________________ _ ____________________________________________________________________ _ ____________________________________________________________________ _ ____________________________________________________________________ 2. Which of the following is NOT an example of a discretionary expense? a. birthday gifts for friends b. rent c. purchase of stocks and bonds d. new clothes 3. Your bank can help you make a budget in all of the following ways EXCEPT: a. providing online budget-making tools linked to your account b. providing access to records of previous expenses and incomes to your account c. linking all of your accounts across multiple financial institutions d. setting up automated alerts to tell you when you are exceeding your budget 4. According to experts however, only about ___% of Americans currently have a personal budget. a. 10 b. 60 PRODUCT PREVIEW
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c. 50 d. 30 5. Personal financial software can help you do all of the following EXCEPT:
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a. decide for you which expenses are important to you and which are not very important b. link accounts together across multiple financial institutions to see a comprehensive picture c. itemize and annualize expenses d. visualize your budget 6. T F To determine a budget variance, subtract total expenses from total income.
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Chapter 14 | The Beauty of the Budget 278
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