Economics & Personal Finance Practice Exam

Income + Taxes

Career decision / Budget

Knowledge

Banking

Scenarios + True & False

Vocabulary

100

The less money you make the more taxes are taken out

Accurate or Inaccurate

Inaccurate, the LESS money you make, you will not be taxed MORE

100

When you get a paycheck Weekly you get paid

A. Biweekly

B. Weekly

C. SemiWeekly

D. Monthly

B. Weekly

100

Is buying school supplies a

A. Fixed

B. Recurring

C. Non-Recurring

D. Whammy

100

What does an interest rate do to your payments when you have a loan/borrowing money

The interest rate is the cost of borrowing money, expressed as a percentage of the total loan amount. The higher the interest rate, the more you'll pay back.

100

You are LEGALLY required to file taxed after your earned income passes $14,600

TRUE or FALSE

TRUE

100

The amount of money you have in your bank account.

Balance / Account balance

200

THIS FORM AN INDIVIDUAL RECEIVES FROM THEIR EMPLOYER SPECIFYING WAGES & WITHHOLDINGS

A. 1040

B. 1099-INT

C. W-2

D. W-4

C. W-2

200

When you get paid Every 2 weeks you receive a paycheck

A. Weekly

B. SemiMonthly

C. BiWeekly

D. Monthly

C. BiWeekly

200

ACHIEVEMENT/MERIT-BASED AID THAT DOESN’T HAVE TO BE REPAID

A. COMMISSIONED

B. ENLISTMENT

C. GRANTS

D. SCHOLARSHIPS

200

What does an interest rate do for your money in your savings account.

The interest rate is the return on a savings account, expressed as a percentage of your savings. The higher the interest rate, the more you'll earn

200

FDIC covers both Banks and Credit Unions insured policy for customers.

TRUE or FALSE

FALSE

FDIC covers for Banks

NCUA covers for Credit Unions

200

A certain amount of money that must be kept in an account, as required by that particular financial institution.

Minimum Balance

300

THE MAIN FORM AN INDIVIDUAL SENDS TO THE I.R.S. WHEN THEY FILE FEDERAL INCOME TAXES

A. 1040

B. 1099-INT

C. W-2

D. W-4

A. 1040

300

When you receive a Paycheck 24 times out of the year your pay is

A. Monthly

B. Semi Monthly

C. BiWeekly

D. Weekly

B. Semi Monthly

300

When moving into a home, how many fee will you have to pay

A. 14+

B. 9-13

C. 5-8

D. 1-4

A. 14+

Rent, Fees (application, administrative, move-in, or move-out.), Utilities (electricity, water, gas, internet, cable,), Parking, Maintenance, Renters insurance and others fees may vary.

300

Reinvesting earned interest back into the principal to
allow money to grow exponentially over time

Compound Interest

300

Your are LEGALLY required to file for taxes if you have an unearned income of $1,250 or more

TRUE or FALSE

TRUE

300

Money set aside for unanticipated expenses or loss of
income

Emergency Funds

400

AWARDED BASED ON F.A.F.S.A.

A. COMMISSIONED

B. ENLISTMENT

C. GRANTS

D. SCHOLARSHIPS

C. GRANTS

400

The basic services your home, apartment, or business needs to keep it comfortable and functioning properly (e.g. water, electricity, etc.)

Utilities

400

Eating at a restaurant is a

A. Fixed

B. Recurring

C. Non-Recurring

D. Whammy

C. Non-Recurring

400

How many payment transactions does a consumer make in a typical month?

A. 46

B. 56

C. 76

D. 86

A. 46 Transactions

400

Zero based budgeting is when you have paid all your bills first and you only have money for expenses.

TRUE or FALSE

FALSE

400

The rate at which the price of goods increases and consumer purchasing power decreases over time

Inflation.

500

THE FORM THAT AN INDIVIDUAL RECEIVES FROM THEIR BANK ON INTEREST-BEARING ACCOUNTS

A. 1040

B. 1099-INT

C. W-2

D. W-4

B. 1099-INT

500

A budgeting method where every anticipated earning is assigned a role to be spent, saved, or invested somewhere, so there's no "leftover" money with no purpose

Zero-Based budget

500

Which of the three R's represent this sentence

" Do I need this?"

A. Responsibility

B. Reality

C. Restraint

D. Realization

B. Reality

500

A document that summarizes all the activity in a checking account over a specific time period, usually a month:

Bank/Checking Statement

500

50/30/20 budget is when 50% of your income goes to wants, 30% goes to necessity, 20% goes to savings

TRUE or FALSE

FALSE

500

A card that is directly connected to your checking account; it enables you to conduct ATM transactions and to make purchases instead of using cash or writing a check

Debit Card

600

THIS FORM IS FILLED OUT WHEN AN EMPLOYER IS ONBOARDED WHERE THEY INDICATE THEIR PREFERENCES FOR WITHHOLDINGS FOR FEDERAL INCOME TAXES

A. 1040

B. 1099-INT

C. W-2

D. W-4

600

When should you begin acting like your interview has started?

A. When you enter the room with your interviewer

B. When the interviewer has let you know the interview has started

C. After you’re past security, but before you meet the office assistant

D. As soon as you encounter anyone in/around the organization you’re interviewing with

600

Which bill usually accounts for the largest part of your monthly utility bill?

A. Car loan

B. Rent

C. Water Bill

D. Electric Bill

600

When you personally put money into your account

Deposit

600

Tori is a 20 Year old, junior in college that lives with her parents. She has a side gig as a graphic designer and her net earnings were $2,150

Is Tori Legally required to file taxes?

A. No, She still lives with her parents and does not make enough

B. Yes, She is self employed and made more than the max for self employed pay

C. No, She is a dependent

D. Yes, she is independent

B. Yes, She is self employed and made more than the max for self employed pay

600

The government agency that insures customer deposits if a bank fails up to $250,000 per individual depositor

Federal Deposit Insurance Corporation (FDIC)

700

TOTAL INCOME BEFORE TAXES, CONTRIBUTIONS, OR ANY OTHER EXPENSES

A. ADJUSTED GROSS INCOME

B. GROSS INCOME

C. INVOLUNTARY WITHHOLDING

D. STANDARD DEDUCTION

B. GROSS INCOME

700

IF A PERSON WORKS 60 HOURS FOR THE WEEK, AT A HOUR WAGE OF $30 PER HOUR, WHAT IS THEIR GROSS PAY FOR THE WEEK?

A. $1,800 = ($30 / HOUR)(60 HOURS)

B. $2,700 = ($30 / HOUR)(60 HOURS)(1.5)

C. $2,400 = ($30 / HOUR)(20 HOURS) + ($30 / HOUR)(40 HOURS)(1.5)

D. $2,100 = ($30 / HOUR)(40 HOURS) + ($30 / HOUR)(20 HOURS)(1.5)

700

OVERTIME PAY FOR WORK BEYOND STANDARD WORKWEEK AVAILABLE

A. COMMISSION

B. FREELANCE

C. HOURLY WAGE

D. SALARY

C. HOURLY WAGE

700

A type of savings account, typically offering higher
interest rates, that is managed entirely online with no
physical bank branch

Online Savings Account

700

A high school senior plans to attend a 4 year college & has a goal to graduate debt free. She plans to prepare herself by working a summer Job. What should the student do

A. She should spend her money on entertainment and pay college with a credit card.

B. She should invest her money in a savings account to use for college

C. She should invest her money in the stock market

D. she should spend her money on college and take out a loan to pay for a new car.

B. She should invest her money in a savings account to use for college

700

An automatic electronic deposit of net pay to an employee's designated bank account

Direct Deposit

800

INCOME AFTER ALL WITHHOLDINGS; TAKE-HOME PAY

A. DISPOSABLE INCOME

B. EFFECTIVE TAX RATE

C. MARGINAL TAX RATE

D. NET INCOME

800

A cost that can be expected at regular intervals and that remains the same amount (e.g., monthly rent payment)

Fixed Expenses.

800

Which of the three R's represent this sentence

" If I buy this, will I stay in my budget?"

A. Responsibility

B. Reality

C. Restraint

D. Realization

A. Responsibility

800

Allows a person to manage a bank account holder's funds through actions such as withdrawing
or depositing money, viewing account balances, etc.

(Have to know the name/ not the acronym for points)

Automatic Teller Machine (ATM)

800

Mason Is 17 years old, a junior in high school, and lives with his parents. He had unearned income of $750

Can he be claimed as a dependent?

A. No, he made more than the max for unearned income so he needs to file for taxes

B. Yes, he made under the max for unearned income

C. No, he he has more unearned income coming in

D. All the above is wrong

B. Yes, he made under the max for unearned income

800

A form that details all "non-employee" compensation,
including for specific jobs like freelancers or contractors

1099 Tax form

900

If you are deciding to be Exempt from your taxes, is any money coming out of your paycheck?

NO, taxes will not be withheld!

900

Alyssa enjoys social situations, has great conversational skills, and is excited to start her job search. What job search strategy would highlight her strengths the most?

A. Looking through online job boards and websites

B. Attending in-person networking events

C. Using LinkedIn to connect with people in her field

D. Browsing company websites for job postings

B. Attending in-person networking events

900

NO OVERTIME PAY, BUT USUALLY EARN MORE & ASSOCIATED WITH WHITE-COLLAR JOBS

A. COMMISSION

B. FREELANCE

C. HOURLY WAGE

D. SALARY

900

A written order that instructs a financial institution to transfer money from one account to another:

A Check

900

Many graduates choose to go to a community college or trade school after graduation to save on tuition. Typically, a trade school program takes two years to complete, ending with an apprenticeship in the student’s chosen trade to provide hands-on training. How does the decision to go to trade school rather than university affect one’s long-term financial goals?

A. It leads to more hands-on training and more difficulty finding a job.

B. It leads to less hands-on training and less difficulty finding a job

C. It creates less debt from tuition and the ability to enter the workforce sooner.

D. It creates more debt from tuition, and trade school takes longer to complete.

C. It creates less debt from tuition and the ability to enter the workforce sooner.

900

The cost you pay each year to borrow money, including fees, expressed as a percentage

Annual Percentage Rate (APR)

1000

What is the start for filing taxes for unearned income

A. $1,250

B. $1,000

C. $750

D. $500

A. $1,250

1000

Alec has decided he’s going to make sure he does the following things in his upcoming job search: research any potential employers he might interview with, create a list of conversation starters for when they meet, and send a personalized thank you after any interviews. Which of the following is TRUE?

A. Alec will come across as too pushy or overeager for potential employers

B. Alec doesn’t need to do these things because he doesn’t have any prior experience

C. Alec will show that he is engaged and that he cares

D. Alec is ensuring he will receive priority over other applicants

C. Alec will show that he is engaged and that he cares

1000

INCOME BASED ON SALES

A. COMMISSION

B. FREELANCE

C. HOURLY WAGE

D. SALARY

A. COMMISSION

1000

A mobile banking tool that allows you to deposit checks to your bank account using your mobile device

Mobile Deposit

1000

Military members and veterans have access to valuable benefits. Some are for families too.

Health Care:
Housing:
Education
Life Insurance
Job Training and Help
Retirement

Based on the text, how can joining the military contribute to a person’s financial well-being? EPF.IE.1.1

A. It guarantees a person a college degree.

B. It guarantees a person lifelong employment.

C. It provides a person with free housing and education.

D. It provides a person with training and benefits.

1000

A loan with an interest rate that does not change over the life of the loan

Fixed Rate Loan

1100

ATTENDING COLLEGE SIMULTANEOUSLY WITH MILITARY TRAINING TO BECOME AN OFFICER

A. COMMISSIONED

B. ENLISTMENT

C. GRANTS

D. SCHOLARSHIPS

A. COMMISSIONED

1100

What is one way a cover letter differs from a resume?

A. It lists your relevant work history, skills, and education

B. It highlights your personal story and interest in the position

C. It is always required as a part of the application process

D. It is a generic document that you can send to multiple employers

B. It highlights your personal story and interest in the position

1100

Which of the three R's represent this sentence

" Can I wait to have this."

A. Responsibility

B. Reality

C. Restraint

D. Realization

C. Restraint

1100

The number of goods and services that money can buy. It can weaken in time due to inflation.

Purchasing Power

1100

A young woman is graduating from high school in June. She has been working for a company in an unpaid apprenticeship and offered full-time employment upon graduation. She has also been accepted to a college and was offered a full scholarship. The woman has chosen to accept the job offer rather than attend college. How will the young woman’s choice to accept the job instead of attending college most likely affect her financial plan?

A. The woman will begin generating income immediately but may earn lower income in the long term.

B. The woman will have fewer credit needs immediately but will accrue student loan debt in the long term.

C. The woman will earn less money immediately but may have more business opportunities for making money in the long term.

D. The woman will lack the opportunity to master skills immediately but will have more opportunities for professional development in the long term.

A. The woman will begin generating income immediately but may earn lower income in the long term.

1100

A market in which there is increased stock trading and
rising stock prices

Bull Market

1200

Besides Tuition, what are three expenses associated with college?

books and supplies, Transport, Housing, electronics, eating out, internship, personal bills

1200

Based on the chart, what effect does education have on the salary & employment of individuals?

A. Individuals with a high school diploma are more likely to be unemployed than those without a high school diploma.

B. Obtaining a college degree ensures that individuals will be employed.

C. Obtaining a doctoral degree ensures that individuals will receive the highest weekly earnings.

D. Individuals with higher levels of education are more likely to have higher weekly earnings and lower rates of unemployment.

1200

A resume should…

A. Include a photo of you looking professional

B. Detail your accomplishments in at least 2-3 pages

C. Use a casual and personable tone

D. Highlight your most relevant skills and experience

1200

A type of savings account that holds a fixed amount of money for a set period of time, known as the term. In exchange, the bank pays interest on the deposit.

Certificate od Deposit

1200

Many students discover that attending a four-year college will not assist them in accomplishing their professional goals in life. Students who are more interested in professions that have them work with mechanical or technical skills may find that a vocational degree is better suited for them. They can attend a community college or trade school to receive the necessary accreditation and degree. The decision to pursue a vocational degree contributes to a long-term career goal by providing…

A. educational resources that serve as a pathway to a military career.

B. educational resources that serve as a pathway to a four-year degree.

C. hands-on training, & resources are specifically geared to jobs in demand.

D. training & financial assistance throughout the program until a job is secured.

C. hands-on training, & resources are specifically geared to jobs in demand.

1200

An individual who earns money on a per-job or per-task basis, usually for short-term work. They are not employees of an organization.

Freelancer

1300

What is the Standard deduction to start filing for taxes

A. $13,000

B. $13,600

C. $14,000

D. $14,600

1300

A young woman could attend a university and major in Mechanical Engineering, or she could attend her local community college and become an auto mechanic. Attending a university would be expensive, and she would have to take out student loans. While mechanical engineers make good money, she would still be paying off those loans for decades after she graduated college. She also knew she wanted to start saving for retirement right away. The young woman chose to pursue a career as an auto mechanic at her local community college. Based on the text, which is a result of the young woman choosing a technical education over attending a university?

A. It will take her longer to enter the workforce, but she will have less debt.

B. She will not be able to start saving for retirement quite as soon; however, her debts will be lower.

C. She will be able to enter the workforce sooner with a specific skill and less debt.

D. It will be cheaper for her to attend a community college, but she will not be able to take out student loans

C. She will be able to enter the workforce sooner with a specific skill and less debt.

1300

The STAR method is a way to answer interview questions that stands for…

A. Situation, Task, Action, Result

B. Situation, Task, Action, Recollect

C. Setup, Task, Action, Result

D. Setup, Think, Action, Result

A. Situation, Task, Action, Result

1300

What are the two insured companies called for when a bank or credit union fails

(Must be able to say both insured policy names for points)

Federal Deposit Insurance Corporation (FDIC) & National Credit Union Administration (NCUA)

1300

A young man enters the workforce immediately after graduating from high school. He begins an entry-level job making $8 per hour. His friend decides that she wants to pursue a technical certification at the local community college. He will have two years of work experience by the time she completes her certification. She will enter the workforce as a certified computer technician making $30 per hour. How can education influence a person’s career plans & goals?

A. Earning a degree reduces debt and makes it easier to pay bills.

B. Going straight into a job allows someone to skip over entry-level positions.

C. Earning a degree or certification can lead to a person getting a job with a higher starting wages

D. Going straight into a job helps a person to earn necessary certifications more quickly.

C. Earning a degree or certification can lead to a person getting a job with a higher starting wages

1300

The amount of money needed to sustain a certain level of living, (including basic expenses such as housing, food, taxes, and healthcare) often used when comparing how expensive it is to live in one city versus another.

Cost of living