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WISE FINANCIAL LITERACY TEST NEWEST
ACTUAL QUESTIONS AND VERIFIED
SOLUTIONS|ALREADY GRADED A+
100%TUTOR VERIFIED
Earned income - .....ANSWER ...✔✔ Income derived
from active participation in a trade or business, including
wages, salary, tips, commissions and bonuses.
unearned income - .....ANSWER ...✔✔ Any income
that comes from investments and other sources unrelated
to employment services. Examples: interest from a
savings account, bond interest, alimony, and dividends
from stock
liquidity - .....ANSWER ...✔✔ The ability to convert an
asset to cash quickly and with minimal impact to the
price
liquidity examples - .....ANSWER ...✔✔ cash, most
stocks, money market instruments and government bonds
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money market accounts - .....ANSWER ...✔✔ it is the
organized exchange on which participants can lend and
borrow large sums of money for a period of one year
or less
bonds - .....ANSWER ...✔✔ it is the organized
exchange on which participants can lend and borrow
large sums of money for a period of one year or less
Gift cards - .....ANSWER ...✔✔ A gift card is a
restricted monetary equivalent is issued by retailers or
banks to be used as an alternative to a non-monetary
gift.
Discretionary income and budget surplus - .....ANSWER
...✔✔ The amount of an individual's income that is left
for spending, investing or saving after taxes and
personal necessities (such as food, shelter, and clothing)
have been paid. Discretionary income includes money
spent on luxury items, vacations and non-essential goods
and services.
money orders - .....ANSWER ...✔✔ A certificate that
allows the stated payee to receive cash
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on-demand, usually issued by governments and banking
institutions. A money order functions much like a check, in
that the person who purchased the money order may
stop payment.
why does the US currency have value - .....ANSWER
...✔✔ Its value is only based on what we can get in
exchange for it. Or put it another way, money has value
as long as other people believe the money you give
them can be
exchanged for the goods and services they desire in the
future.
opportunity cost - .....ANSWER ...✔✔ the value of the
best alternative that must be given up when scarce
resources are used for one purpose instead of another
inflation - .....ANSWER ...✔✔ a general increase in
prices and a corresponding decrease in money's
purchasing power
Consumer Price Index (CPI) - .....ANSWER ...✔✔ a
measure of the overall cost of the goods and services
bought by a typical consumer
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Inflation - .....ANSWER ...✔✔ An increase in the
overall price level.
Who gets hurt the most from inflation - .....ANSWER
...✔✔ Those with fixed incomes (retired people)
who gets hurt the least from inflation - .....ANSWER
...✔✔ borrowers and producers
Treasury department - .....ANSWER ...✔✔ responsible
for issuing all treasury bonds, notes, and bills.
Pay yourself first - .....ANSWER ...✔✔ Put money into
savings each month as if it were a bill. At least 10% of
your income should go into savings. It's
recommended you have 6-8 months of expenses saved.
Certificate of Deposit - .....ANSWER ...✔✔ Low risk
(and low return) investments suitable for cash you don't
need for months or years. (safest type of investment)
traditional CD (certificate of deposit) - .....ANSWER
...✔✔ you receive a fixed interest rate over a
WISE FINANCIAL LITERACY TEST NEWEST
ACTUAL QUESTIONS AND VERIFIED
SOLUTIONS|ALREADY GRADED A+
100%TUTOR VERIFIED
Earned income - .....ANSWER ...✔✔ Income derived
from active participation in a trade or business, including
wages, salary, tips, commissions and bonuses.
unearned income - .....ANSWER ...✔✔ Any income
that comes from investments and other sources unrelated
to employment services. Examples: interest from a
savings account, bond interest, alimony, and dividends
from stock
liquidity - .....ANSWER ...✔✔ The ability to convert an
asset to cash quickly and with minimal impact to the
price
liquidity examples - .....ANSWER ...✔✔ cash, most
stocks, money market instruments and government bonds
,2|Page
money market accounts - .....ANSWER ...✔✔ it is the
organized exchange on which participants can lend and
borrow large sums of money for a period of one year
or less
bonds - .....ANSWER ...✔✔ it is the organized
exchange on which participants can lend and borrow
large sums of money for a period of one year or less
Gift cards - .....ANSWER ...✔✔ A gift card is a
restricted monetary equivalent is issued by retailers or
banks to be used as an alternative to a non-monetary
gift.
Discretionary income and budget surplus - .....ANSWER
...✔✔ The amount of an individual's income that is left
for spending, investing or saving after taxes and
personal necessities (such as food, shelter, and clothing)
have been paid. Discretionary income includes money
spent on luxury items, vacations and non-essential goods
and services.
money orders - .....ANSWER ...✔✔ A certificate that
allows the stated payee to receive cash
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on-demand, usually issued by governments and banking
institutions. A money order functions much like a check, in
that the person who purchased the money order may
stop payment.
why does the US currency have value - .....ANSWER
...✔✔ Its value is only based on what we can get in
exchange for it. Or put it another way, money has value
as long as other people believe the money you give
them can be
exchanged for the goods and services they desire in the
future.
opportunity cost - .....ANSWER ...✔✔ the value of the
best alternative that must be given up when scarce
resources are used for one purpose instead of another
inflation - .....ANSWER ...✔✔ a general increase in
prices and a corresponding decrease in money's
purchasing power
Consumer Price Index (CPI) - .....ANSWER ...✔✔ a
measure of the overall cost of the goods and services
bought by a typical consumer
, 4|Page
Inflation - .....ANSWER ...✔✔ An increase in the
overall price level.
Who gets hurt the most from inflation - .....ANSWER
...✔✔ Those with fixed incomes (retired people)
who gets hurt the least from inflation - .....ANSWER
...✔✔ borrowers and producers
Treasury department - .....ANSWER ...✔✔ responsible
for issuing all treasury bonds, notes, and bills.
Pay yourself first - .....ANSWER ...✔✔ Put money into
savings each month as if it were a bill. At least 10% of
your income should go into savings. It's
recommended you have 6-8 months of expenses saved.
Certificate of Deposit - .....ANSWER ...✔✔ Low risk
(and low return) investments suitable for cash you don't
need for months or years. (safest type of investment)
traditional CD (certificate of deposit) - .....ANSWER
...✔✔ you receive a fixed interest rate over a
