Post Test: Money Management

1.

Give a Definition for money management.

Explanation
Money management refers to the practice of handling and controlling one's finances in a responsible and prudent manner. It involves making informed decisions about how to allocate and utilize money, ensuring that expenses are within budget and income is properly managed. By effectively managing money, individuals can achieve financial stability, meet their financial goals, and avoid unnecessary debt or financial hardships.

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2.

Understanding food is an example of a need and stake is a want. Another example of a want vs. need is:

A.

Clothes vs. Name brand jeans
B.

Water vs. Coke
C.

Coke vs. Pepsi
D.

Transportation Vs. Personal Vehicle
E.

Ralph Lauren vs. Calvin Klein

Correct Answer(s)
A. Clothes vs. Name brand jeans
B. Water vs. Coke
D. Transportation Vs. Personal Vehicle

Explanation
More than one answer may be correct.

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3.

The amount of your income from your wages or salary before payroll deductions is called:

A.

Gross income
B.

Net income
C.

Paycheck
D.

Taxes

Correct Answer
A. Gross income

Explanation
Gross income refers to the total amount of income earned from wages or salary before any deductions such as taxes, insurance, or retirement contributions are taken out. It represents the total earnings received by an individual before any expenses or deductions are subtracted. Net income, on the other hand, is the amount of income remaining after all deductions have been made. Paycheck refers to the actual amount of money received by an individual in the form of a physical or electronic payment. Taxes are the specific amount of money paid to the government as a percentage of income.

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4.

The amount of income from your wages or salary after payroll deductions is called:

A.

Gross income
B.

Net income
C.

Paycheck
D.

Taxes

Correct Answer
B. Net income

Explanation
Net income refers to the amount of income that an individual earns from their wages or salary after all payroll deductions have been subtracted. These deductions may include taxes, insurance premiums, retirement contributions, and any other withholdings. Net income is the actual amount of money that an individual takes home and can use for their expenses and savings. It is important to distinguish net income from gross income, which is the total amount of income earned before any deductions are made.

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5.

Name one factor to consider when choosing a bank for opening a checking account.

Correct Answer
Service fees
Service charges
location
use of card
credit limits

Explanation
When choosing a bank for opening a checking account, it is important to consider factors such as service fees, service charges, location, use of card, and credit limits. Service fees and charges can vary between banks and can significantly impact the overall cost of maintaining a checking account. The location of the bank is also crucial as it should be easily accessible for regular banking needs. The use of card, including ATM access and debit card usage, is another factor to consider for convenient and efficient banking. Lastly, credit limits may be relevant for those who require overdraft protection or want to access credit facilities through their checking account.

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6.

What is the common factor to consider for the deduction on your pay stub called FICA?

Correct Answer
Social security
SS
S.S.

Explanation
The common factor to consider for the deduction on your pay stub called FICA is social security. FICA stands for the Federal Insurance Contributions Act, which requires employees to contribute a portion of their wages to fund social security and Medicare programs. The deductions for social security are typically listed as SS or S.S. on the pay stub. These deductions are used to provide retirement, disability, and survivor benefits to eligible individuals.

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7.

The more exemptions you clam on your W-4 (Employee Withholding Allowance Certificate) the fewer taxes are taken from you monthly pay.

A.

True
B.

False

Correct Answer
A. True

Explanation
By claiming more exemptions on your W-4, you are essentially reducing the amount of taxes that are withheld from your monthly pay. This means that you will have a higher take-home pay each month. The number of exemptions you claim on your W-4 determines the amount of tax withheld, so the more exemptions you claim, the less tax is taken out of your paycheck. Therefore, the statement is true.

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8.

Define the term "Value"

Correct Answer
Standards
Morals
Principles
ethics
Ideas

Explanation
The term "value" refers to the standards, morals, principles, ethics, and ideas that a person or society holds as important or desirable. These values shape our behavior and decision-making, guiding us in distinguishing between right and wrong, good and bad, and what is meaningful and valuable in life. They serve as a foundation for our beliefs, attitudes, and actions, influencing our relationships, choices, and overall worldview.

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