Unit 2 (SSEPF2) Reassessment Review

Which of the following best describes a key rule of the "envelope" budgeting method?

• You can borrow from other envelopes if one runs out.

• You only spend what is in each envelope for its specific category.

• You deposit all your cash into a single envelope for all expenses.

• You do not need to track your spending by category.

Which of the following is considered a variable expense?

• Car payment

• Electricity bill

• Health insurance premium

• Student loan payment

Which of the following categories is important to consider when creating a personal budget?

• Emergency Fund

• Variable Expenses

• Entertainment

• All of the above

Which of the following best describes the main goal of zero-based budgeting?

• To ensure you never spend more than you earn in a month.

• To assign a specific purpose to every dollar of your income.

• To keep your bank account balance at zero.

• To avoid using cash for any purchases.

What is the term for the profit earned when you sell a stock for a higher price than you paid for it?

• Dividends

• Capital Gains

• Royalties

• Salary

Which of the following is NOT typically taken out of an employee's paycheck?

• Gym Membership Fees

• Federal Taxes

• State Taxes

• Social Security

Sarah earns $14 an hour at her full-time job. If she works overtime and her company pays the standard overtime rate of 1.5x pay, what is Sarah's pay per hour for overtime?

• $14

• $21

• $24

• $30

After graduating, you start your first job and receive a net monthly income of $3,000. You calculate that your monthly expenses, including rent, utilities, food, and transportation, total $3,200. Which of the following statements is CORRECT?

• You need to reduce your expenses or increase your income to avoid running a budget deficit

• You can comfortably save a portion of your income each month

• You have $200 left over each month for entertainment

• You are able to make additional investments without adjusting your budget

Maria works part-time at a retail store and earns $2,200 for the month. After all deductions for taxes and insurance, she receives $1,800 as her take-home pay. Which of the following statements is correct?

• Her gross pay is $1,800 and net pay is $2,200

• Her gross and net pay are $2,200

• Her gross pay is $2,200 and net pay is $1,800

• Her gross and net pay are $1,800

After reviewing her expenses, Maria notices she has exceeded her monthly budget by about $200 for the past two months. Which of the following actions would be the most reasonable way for her to address this issue?

• Reduce her grocery spending by planning meals and avoiding takeout

• Stop making extra payments on her car loan and only pay the minimum required

• Sell her laptop and buy a cheaper used one

• Cut her monthly savings by $100 and her entertainment budget by $100