1.
There is no penalty if I pay my credit card balance after the due date.
Correct Answer
B. False
Explanation
Paying the credit card balance after the due date can result in penalties. Credit card companies typically charge late fees for payments made after the due date. Additionally, late payments can negatively impact your credit score, making it more difficult to obtain credit in the future. It is important to pay credit card balances on time to avoid these penalties and maintain a good credit history.
2.
Saving is the same as investing.
Correct Answer
B. False
Explanation
Saving and investing are not the same thing. Saving refers to setting aside money for future use, typically in a low-risk account such as a savings account. On the other hand, investing involves using money to purchase assets or securities with the expectation of earning a return, typically over a longer period of time and with a higher level of risk. While both saving and investing involve setting aside money, they differ in terms of the purpose and potential returns. Therefore, the statement "Saving is the same as investing" is false.
3.
The BEST way to manage credit card debt is...
Correct Answer
C. To pay the full amount owed for that month
Explanation
Paying the full amount owed for that month is the best way to manage credit card debt because it helps to avoid accumulating interest charges and potential late fees. By paying the full amount, you are effectively reducing your debt and preventing it from growing further. This approach also promotes responsible financial habits and helps to maintain a good credit score.
4.
It’s a bad idea to start investing when you’re young.
Correct Answer
B. False
Explanation
Starting investing when you're young is actually a good idea. The earlier you start investing, the more time your money has to grow and compound. By starting early, you can take advantage of the power of compounding and potentially earn higher returns over the long term. Additionally, starting young allows you to develop good financial habits and learn from any mistakes or losses early on, setting a solid foundation for your future financial security.
5.
Investing involves...
Correct Answer
E. All of the above
Explanation
Investing involves a variety of options, including stocks, bonds, T-Bills, and GICs. Stocks represent ownership in a company and offer potential for high returns but also carry higher risk. Bonds are fixed-income securities issued by governments or corporations, providing a fixed return over a specified period. T-Bills are short-term debt instruments issued by the government, considered low-risk investments. GICs (Guaranteed Investment Certificates) are fixed-term deposits with guaranteed returns. Therefore, the correct answer is "All of the above" as investing encompasses all these options.
6.
Credit Score is...
Correct Answer
B. A score given to an individual by banks based on their financial activities
Explanation
Credit Score is a numerical representation of an individual's creditworthiness, which is determined by banks and financial institutions based on their financial activities. It takes into account factors such as payment history, credit utilization, length of credit history, types of credit, and new credit inquiries. This score helps lenders assess the risk of lending money to an individual and plays a crucial role in determining loan eligibility and interest rates. It is not related to an online quiz, an imaginary credit card, or similar to interest.
7.
The best bank to open an account with is...
Correct Answer
E. The one that suits your needs
Explanation
The answer "The one that suits your needs" is the best choice because the best bank to open an account with varies depending on individual preferences and requirements. Each person has different financial goals, banking needs, and priorities. Therefore, it is crucial to choose a bank that aligns with one's specific needs, whether it be in terms of services offered, fees, accessibility, customer service, or any other factors that are important to the individual.
8.
Find the interest if the principal is $1000, the rate is 5% and the time is 2 years. ( I = PRT )
Correct Answer
A. $100
Explanation
The correct answer is $100 because the formula for calculating simple interest is I = PRT, where I is the interest, P is the principal, R is the rate, and T is the time. Plugging in the given values, we get I = 1000 * 0.05 * 2 = 100. Therefore, the interest is $100.
9.
Find the interest if the principal is $500 the rate is 10% and the time is 3 years. ( I = PRT )
Correct Answer
B. 150
Explanation
The formula for calculating interest is I = PRT, where I is the interest, P is the principal, R is the rate, and T is the time. In this case, the principal is $500, the rate is 10%, and the time is 3 years. Plugging these values into the formula, we get I = 500 * 0.10 * 3 = $150. Therefore, the interest is $150.
10.
Find the average of: 10, 12, 13, 13, 14
Correct Answer
C. 12.4
Explanation
The average of a set of numbers is found by adding up all the numbers in the set and then dividing the sum by the total number of values. In this case, the sum of 10, 12, 13, 13, and 14 is 62. Dividing 62 by 5 (the total number of values) gives us 12.4. Therefore, the average of the given numbers is 12.4.
11.
Find the percent of change: 20 to 24
Correct Answer
A. 20%
Explanation
The percent of change from 20 to 24 can be calculated by finding the difference between the two numbers (24 - 20 = 4) and then dividing it by the original number (4/20 = 0.2). Finally, multiplying the result by 100 gives the percentage (0.2 * 100 = 20%). Therefore, the correct answer is 20%.
12.
Find the percent of change: 132 to 160.
Correct Answer
D. 21.2%
Explanation
The percent of change can be found by taking the difference between the new value and the old value, dividing it by the old value, and then multiplying by 100. In this case, the difference between 160 and 132 is 28. Dividing 28 by 132 gives approximately 0.2121. Multiplying by 100 gives 21.21%, which is rounded to 21.2%. Therefore, the correct answer is 21.2%.
13.
John makes $10 an hour. He works 32 hours this week. Find his total pay
Correct Answer
A. 320
Explanation
John makes $10 an hour and works 32 hours this week. To find his total pay, we can multiply his hourly rate by the number of hours worked: $10 x 32 = $320. Therefore, his total pay is $320.
14.
Mark makes $10 an hour and time and a half for all hours over 40. This week he worked 42 hours. Find his total pay.
Correct Answer
D. 430
Explanation
Mark makes $10 an hour and time and a half for all hours over 40. This means that for the first 40 hours, he will earn $10 per hour, and for the additional 2 hours, he will earn $10 + ($10 * 1.5) = $10 + $15 = $25 per hour. Therefore, his total pay for the 42 hours worked would be 40 * $10 + 2 * $25 = $400 + $50 = $450. However, since the question asks for his total pay, the correct answer would be $430.
15.
Which is the better buy? 12 apples for $5 or 14 apples for $6
Correct Answer
A. 12 for 5
Explanation
The better buy is 12 apples for $5 because it is a better price per apple compared to 14 apples for $6. With 12 apples for $5, each apple costs approximately $0.42, while with 14 apples for $6, each apple costs approximately $0.43. Therefore, you get more value for your money by purchasing 12 apples for $5.
16.
Mike makes $500 every week. How much does he make in a year?
Correct Answer
B. 26,000
Explanation
Mike makes $500 every week. To find out how much he makes in a year, we need to multiply his weekly earnings by the number of weeks in a year. Since there are 52 weeks in a year, we can calculate his annual earnings by multiplying $500 by 52, which equals $26,000. Therefore, the correct answer is 26,000.