Personal Budget

The income part of a personal budget

• is not important if it is large.

• only includes money from a paycheck (job).

• includes all income from various sources.

• is the amount left over.

The expenses section of a personal budget

• should be larger than the income section of the budget.

• shows the amount of money that is spent each month.

• includes the amount of interest earned on investments.

• is not important if income is greater than expenses.

People keep a personal budget to help them

• set and reach financial goals.

• earn promotions at work.

• buy with credit.

• buy anything they want.

Which of the following people would benefit MOST from a personal budget?

• Tim carefully keeps track of his expenses.

• Sue spends less than she earns.

• David is saving for a major purchase.

• Bob does not have enough money to pay bills.

For which item would someone MOST LIKELY need to save money in order to

purchase?

• a new shirt

• a new washing machine

• a hair dryer

• a video game

Which of the following statements about saving money is false?

• People only save money to build wealth.

• Bank accounts are very safe.

• It is easy to withdraw money from your bank account.

• Most saving accounts pay a small amount of interest.

What is NOT a reason that people usually save money?

• to buy special things for the future

• to have money for emergencies

• to make a payment on an expensive item

• to buy basic necessities

Which item would most likely require savings?

• soccer ball

• a new refrigerator

• a movie ticket

• a box of cookies

I had to give up going out to dinner in order to buy a new shirt. This is an example of

• opportunity cost

• price incentive

• specialization

• poor planning

A budget is a list of

• income and expenditures

• things to buy

• how much to save

• needs and wants