Unit 3 Test Review Consumer Math

Front

FICA deductions are _________.

Back

Mandatory and based on gross income

Front

Which of the following is a type of deduction that employees can choose to have deducted from their pay?

Back

Voluntary retirement savings

Front

Calculate the total for your fixed expenses: Rent: $1,200, Utilities: $150, Credit card payments: $80, Groceries: $120, New Clothes: $60.

Back

$1,550

Front

If you put $500 in a savings account that earns 3.5% APR interest, how much interest will you earn after 1 year?

Back

$17.50

Front

What does the concept of compound interest mean in finance?

Back

Interest grows exponentially based on accumulated interest

Front

Define 'fixed expenses' in personal finance.

Back

Fixed expenses are costs that do not change from month to month, such as rent or mortgage payments.

Front

What is the difference between gross income and net income?

Back

Gross income is the total income before any deductions, while net income is the amount left after deductions.

Front

What is the purpose of a budget?

Back

A budget helps individuals plan their spending and saving to manage their finances effectively.

Front

Explain the term 'APR' in finance.

Back

APR stands for Annual Percentage Rate, which represents the yearly interest rate charged on borrowed money.

Front

What are 'voluntary deductions' from a paycheck?

Back

Voluntary deductions are amounts withheld from an employee's paycheck that are not required by law, such as retirement contributions.