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Financial Literacy Exam Questions with Complete Solutions
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  • Course
  • Financial Literacy
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  • Financial Literacy

When is the best time to apply for a credit card? - Answer-when you have enough income to pay your debts How long will a chapter 7 bankruptcy usually remain on your credit report? - Answer-ten years Which of the following is the best key component of financial literacy? - Answer-being knowled...

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  • October 12, 2024
  • 14
  • 2024/2025
  • Exam (elaborations)
  • Questions & answers

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  • financial literacy exam questions with complete so
  • when is the best time to apply for a credit card

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  • Financial Literacy
  • Financial Literacy

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Financial Literacy Exam Questions with
Complete Solutions
When is the best time to apply for a credit card? - Answer-when you have enough
income to pay your debts

How long will a chapter 7 bankruptcy usually remain on your credit report? - Answer-ten
years

Which of the following is the best key component of financial literacy? - Answer-being
knowledgeable about credit and debt

Good money management is important for which of the following reasons: - Answer-
learning how to make wise financial decisions
understanding that loans cost more money than the amount actually borrowed
being able to invest in a savings account

all of the above

Which of these would contribute to going into debt? - Answer-spending more money
than you make
buying big ticket items without planning on how to pay for them
taking money from your savings to pay for your grocery items

all of the above

Which is the main reason some people choose to file a chapter 13 bankruptcy? -
Answer-It is a more conservative approach to bankruptcy.

The best money-management strategy is which of the following? - Answer-Do not
spend more money than you can pay back each month.

Pick the scenario that best represents the most positive financial outcome. - Answer-
Madeline has one credit card with a $500 maximum limit. Using her credit card will help
her establish a good credit rating to show loan institutions that she is financially
responsible. She does not pay any financial costs because she pays the entire amount
she borrowed on that card each month so she does not incur interest. When the time
comes that she desires to purchase a car, she will be a good candidate to receive a
loan.

A chapter 11 bankruptcy is filed by which of the following? - Answer-businesses

Which of the following best describes sound financial literacy? - Answer-gaining
knowledge about how to handle your finances

, Who should be most responsible for your finances? - Answer-you

Excessive debt does not contribute to which of the following? - Answer-self-sufficiency

Define debt. - Answer-the state of owing money to someone or something

A chapter 7 bankruptcy involves which of the following? - Answer-You get a fresh start
on your finances.

The average American household has accumulated how much credit card debt? -
Answer-between $15,000 and $16,000

When is the best time to start learning money management principles? - Answer-
throughout your lifetime, to be ready to implement when you have money to manage

What was the average college debt of graduating seniors in 2012? - Answer-
approximately $29,000

Approximately how many American households or individuals declared chapter 13
bankruptcy in 2009? - Answer-350,000

People in the eighteen-to-twenty-four age bracket spend nearly what percentage of their
monthly income just on debt repayment? - Answer-30%

Which of the following is not a key component of financial literacy? - Answer-paying the
minimum amount due on your credit cards each month

Which of the following is not an advantage of debit cards? - Answer-They will help you
establish credit for future big-ticket items.

Which of the following is the best definition of a need? - Answer-something you must
have in order to survive

The best definition of "compounded interest" is which of the following? - Answer-interest
that creditors add each year based on what your principal balance is

What is the proper order for making a budget? - Answer-set goals, make a plan, and
follow-up

What is the number one reason why more than half of all Americans spend more money
than they make? - Answer-credit cards

Why can credit unions usually offer higher rates on savings accounts? - Answer-They
are not in the business of making money because every member is an owner of the
company.

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