by alex
Understanding the intricacies of finance can empower you to make informed decisions about your money. This quiz is designed to challenge your knowledge on various financial topics, from budgeting to investing. Are you ready to see how financially savvy you are? Let’s get started and see how you fare!
Financial Literacy Quiz Questions Overview
1. What is the primary purpose of a budget?
To track expenses
To plan for future spending
To increase income
To avoid paying taxes
2. Which of the following is considered a liquid asset?
Real estate
Stocks
Savings account
Automobile
3. What does ‘APR’ stand for in financial terms?
Annual Percentage Rate
Annual Payment Rate
Annual Principal Rate
Annual Premium Rate
4. Which investment type is typically considered the safest?
Stocks
Bonds
Mutual funds
Savings accounts
5. What is the primary benefit of diversifying your investment portfolio?
Maximizing returns
Minimizing risk
Increasing liquidity
Reducing taxes
6. What does ‘FICO’ score represent?
Financial Investment Credit Organization
Fair Isaac Corporation
Federal Insurance Credit Office
Financial Information and Credit Office
7. What is compound interest?
Interest on the initial principal only
Interest on the initial principal and the accumulated interest
Interest on loans only
Interest on savings accounts only
8. Which of the following is a tax-advantaged retirement account?
Savings account
Certificate of deposit
401(k)
Checking account
9. What is the main difference between a credit card and a debit card?
Credit cards charge interest, debit cards do not
Credit cards are linked to a loan, debit cards are linked to a bank account
Credit cards have higher fees, debit cards have lower fees
Credit cards are more widely accepted than debit cards
10. What does ‘ROI’ stand for in investment terms?
Rate of Interest
Return on Investment
Revenue on Investment
Rate of Income
