While the financial crisis continues unfolding and financial regulators worldwide struggle to take appropriate measures to preserve and keep working their financial industries, there is in fact the same underlying issue we "common people" must continue considering and becoming aware of... Financial Literacy.
Since this current mess shouldn't last forever, we must prepare on a thorough basis to understand that financial markets -although a source of savings, earning and now... losses and debt- are not exactly an easy "game" to play; now we must think a bit also about financial risk... a big issue nowadays that we'll discuss on upcoming posts.
Do we want to be financially intelligent? If your answer is yes, let's watch these slides...
Finally, Have you considered taking a financial literacy test like this one? Care to give it a try?
Take the financial literacy test
A. Term
B. Collision
C. Comprehensive
D. Liability
More questions and the answers after the break
2. Many savings programs are protected by the Federal government against loss. Which of the following is not?
A. Bond issued by one of the 50 States
B. U. S. Treasury Bond
C. U. S. Savings Bond
D. Certificate of deposit at the bank
3. Over a long period — 10 or 20 years — which asset normally gives the highest rate of return?
A. Savings accounts
B. Bonds
C. Stocks
D. Precious metals such as gold
4. Inflation can cause difficulty in many ways. Which group would have the greatest problem during periods of high inflation that last several years?
A. Young couples with no children who both work
B. Young working couples with children
C. Older, working couples saving for retirement
D. Older people living on fixed retirement income
5. Under which of the following circumstances would it be financially beneficial for you to borrow money to buy something now and repay it with future income?
A. When some clothes you like go on sale
B. When the interest on the loan is greater than the interest you get on your savings
C. When you need to buy a car to get a much better paying job
D. When you really need a vacation
6. If your credit card is stolen and the thief runs up a total debt of $1,000, but you notify the issuer of the card as soon as you discover it is missing, what is the maximum amount that you can be forced to pay according to Federal law?
A. Nothing
B. $50
C. $500
D. $1,000
7. If the interest rate falls, what should happen to bond prices?
A. Rise
B. Fall
C. Stay the same
8. Which of the following statements is not true of most Automated Teller Machine, or ATM, cards?
A. You can get cash anywhere in the world with no fee.
B. You must have a bank account to have an ATM Card.
C. You can generally get cash 24 hours a day.
D. You can generally obtain information concerning your bank balance at an ATM machine.
9. Which of the following best describes the primary sources of income for most people ages 20-35?
A. Profits from business
B. Rents
C. Dividends and interest
D. Salaries, wages, tips
10. Stocks are normally riskier than bonds.
A. True
B. False
11. If you went to college and earned a four-year degree, how much more money could you expect to earn than if you only had a high school diploma?
A. A little more; about 20% more.
B. A lot more; about 70% more.
C. About 10 times as much.
D. No more; I would make about the same either way.
12. If you are behind on your debt payments and go to a responsible credit counseling service such as the Consumer Credit Counseling Services, what help can they give you?
A. They can get the federal government to apply your income taxes to payoff your debts.
B. They can force those who loaned you money to forgive all your debts.
C. They can cancel and cut up all of your credit cards without your permission.
D. They can work with those who loaned you money to set up a payment schedule that you can meet.
Answers:
1. B
2. A
3. C
4. D
5. C
6. B
7. A
8. A
9. D
10. A
11. B
12. D
Don't steal my work!
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