Personal finance pre-test 50 questions for 2023

Personal finance pre-test 50 questions: Prior to an interview, recruiters can analyse candidates’ financial knowledge and job preparedness with a finance aptitude test.

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Personal finance pre-test 50 questions

1. Which of the following can help fund local governmental operations?

  • A property tax
  • A capital gains tax
  • A payroll tax
  • A Social Security tax

2. Jerry has an annual income of $85,000. He also has $5,000 in exemptions and $10,000 in deductions. What is Jerry’s taxable income?

  • $70,000
  • $80,000
  • $75,000
  • $100,000

3. Why do some believe that the progressive tax system is discriminatory?

  • Because they don’t feel that it helps the poor enough
  • Because they feel that it decreases government revenue
  • Because they have to pay more taxes, yet gain no comparable benefit from it
  • Because a lot of people feel like it increases the class divide between the rich and poor

4. Identity which of the following corporations pays a flat tax of 35%:

  • Happy Dog is a corporation that provides veterinarian services to dogs.
  • Tomson and Sons, an accounting service
  • Silver Legal, a law firm from New York
  • None of the answers are correct.

5. Jane is asking for a small loan for 30 to 90 days, as she just needs some money to work on home repairs. She knows she will be able to pay the loan back soon. What kind of loan will she MOST likely take?

  • Installment credit
  • Mortgage loan
  • Non-installment credit
  • Revolving credit

6. Which of the following may be used as collateral?

  • Deposits
  • Cars
  • Houses or apartments
  • All of the answers are correct.

7. A personal loan, which tends to have a high-interest rate, is a type of _____ loan.

  • a secure
  • an unsecured
  • a collaterally guaranteed
  • a mortgage

8. Which of the following lines sums up the opinion present in many banks if you have no previous loans?

  • No credit is bad credit
  • No credit leads to a reliable customer
  • No credit, no gloom, and doom
  • No credit doesn’t matter, the only things inevitable are death and taxes.

9. James has created trust for his son Kyle. James has a cousin, Sara, whom he expects to be the trustee in case of his death. Whose consent is legally required to make any amendment or for the trust to be revoked if James dies?

  • Only Sara needs to consent.
  • Only Kyle needs to consent.
  • No amendment can be made.
  • Nobody needs to consent in order for changes to be made.

10. Kasandra is a healthy 40-year-old with an income below the federal poverty level. Which of the following healthcare programs is she able to access?

  • Medicare Part A
  • Medicare Part B
  • Medicaid
  • Unemployment Benefits
Personal finance pre-test 50 questions for 2023

11. Thomas is finally retiring next year. As he has been working full-time since he was 18, he has hardly considered any part of what he will do when he retires. He isn’t even certain who manages the Social Security Trust Fund. He asked his friend, who told him the agency responsible for it was the _____.

  • None of these choices is correct
  • Department of the Labor
  • local government
  • Department of Health and Human Services

12. Which of the following is a requirement for a will to be legally executable?

  • One must be of sound mind and free of mental illness
  • The person drafting and signing the will must not do so under duress or threat.
  • The person drafting and signing the will must want to draft a will to dispose of property in the event of death.
  • All of the answers are correct.

13. When considering a deed of trust, the acceleration clause provision MOST often addresses the issue of _____.

  • borrower default on a loan
  • limitations imposed on the homeowner’s association
  • whether a homeowner can rent their home to obtain rental income
  • whether a community can legally classify as 55 and over

14.Which is the item MOST commonly associated with the purchase of a home that can reduce federal tax liability?

  • Mortgage interest
  • An easement
  • A special tax assessment
  • Ad valorem taxes

15.Which item is relevant for consideration when making application for either a 15 or 30 year mortgage?

  • Interest.
  • Monthly payments.
  • Both interest and monthly payments.
  • None of these answers are correct.

16. High-yield savings accounts tend to offer significantly higher interest rates than traditional savings accounts. How much higher are rates typically?

  • A.2 times as high
  • B.5 times as high
  • C.10 times as high
  • D.20 times as high

17. Your bank just notified you that your 12-month Certificate of Deposit (CD) is maturing. What factors are important to consider before you decide to let it automatically renew?

  • A.There is a good chance you might need the funds in a shorter time frame.
  • B.Interest rates have gone up since you opened the CD.
  • C.You want to do a comparison check of competitive offerings—looking for better rates, lower fees or lower minimum deposits.
  • D.All of the above

18. It’s a fact: 60% of today’s households face a financial emergency each year, but 40% say they don’t have enough savings to cover a $400 unexpected expense. How much money should you aim to set aside in an emergency fund to handle unanticipated expenses?

  • A.One months’ salary
  • B.Three to six months’ worth of essential living expenses
  • C.Enough to pay the rent/mortgage

19. Which savings strategy will get you to $1 million in the bank by age 65, assuming 8% annualized returns?

  • A.Save $200 a month, starting at age 20
  • B.Save $400 a month, starting at age 30
  • C.Save $800 a month, starting at age 40
  • D.Save $1,500 a month, starting at age 50

20. Which statement about fixed vs. variable interest loans is false?

  • A.Interest on fixed-rate loans stays the same for the life of the loan.
  • B.Interest on variable-rate loans can fluctuate, which could affect the payments you must make.
  • C.Interest rates on fixed-rate loans are usually lower than starting rates on variable-rate loans.

21. You have a joint account with your spouse. You also have an individual account at the same bank, but your spouse does not. How much insurance do you have as a couple?

  • A.$100,000
  • B.$250,000
  • C.$750,000
  • D.$1 million

22. What types of things could make it necessary to revise your budget and monthly forecasts?

  • A.Your property tax bill increased.
  • B.You decided to splurge on a new coffeemaker.
  • C.You want to boost your contributions to a retirement account.
  • D.A and C.

23.. Are contributions to a traditional 401(k) plan deducted from your salary before or after taxes?

  • A.Before
  • B.After

24. True or false? There is no age limit for contributing to a Roth IRA, as long as you have earned income that doesn’t exceed the annual limit set by the IRS each year.

  • A.True
  • B.False

25. How high must your FICO credit score be for you to qualify for the best interest rates?

  • A.600
  • B.650
  • C.700
  • D.750
  • E.800

Other Personal finance pre-test 50 questions

True or false: Read each item carefully, then decide whether it is true or false.

_ 1. Compound interest is interest paid on interest previously earned. 2. It is important to build up your FICO score by taking out credit cards and car loans.
3. The purpose of insurance is to transfer risk.
4. Opportunity cost is the value of the option you chose to do.
5. It is not necessary to record debit card transactions in your check register because accounts are now online.
6. Medicare and Social Security compose payroll tax called FICA.
7. One of the most important factors to consider when choosing a career is income potential.
8. One way to protect your identity is to carry your Social Security card in your wallet.
9. Mutual Funds are comprised of several thousand stocks.
10. A Roth IRA is used for retirement savings.
11. The Rule of 92 is a way to estimate the time or interest rate you’d need to double your money in an
12. A written budget will help you identify how and where you spend your money.
13. It is not necessary to carry renter’s insurance if you live in a college dorm or don’t have items of high
14. You are entitled to a free credit report once a year from each of the three major credit bureaus.
15. Don’t fund your 401(k) if your employer does not offer a match.

Financial behavior: Read each question and mark the answer that reflects your financial situation.

  16. Do you currently make a written monthly budget?
  17. Do you currently talk to your parents or guardian about money?
  18. Do you save money on a regular basis?
  19. Do you currently have a checking or savings account?
  20. Do you know how to protect your identity?
  21. Do you think having a credit card is necessary to build your credit?
  22. Do you know how to save money on car insurance?
  23. Do you think having renter’s insurance is necessary when you rent an apartment or live in a college
  24. Do you think it is necessary to take out a student loan to go to college?
  25. Do you think it is required to make monthly payments on credit card balances?


  1. A credit report is:
    a. A list of your financial assets and liabilities
    b. Your monthly credit card statement
    c. A loan and bill payment history
    d. Your credit line with your financial institution
  2. In terms of credit, what does APR stand for?
    a. Annual Percentage Rate
    b. Annual Penalty Rate
    c. Annual Payment Rate
    d. Annual Payoff Rate
  3. Who insures your stocks in the stock market?
    a. The Federal Deposit Insurance Corporation
    b. The Securities and Exchange Commission
    c. The U.S. Department of the Treasury
    d. No one
  4. Federal law gives you three days to cancel the purchase of a new or used car from a dealer.
  5. The type of car you own affects the price you pay for auto insurance.
  6. A reverse mortgage is:
    a. A rising debt loan
    b. Only available to someone 62 years of age or older
    c. Generally not tied to income
    d. All of the above
  7. How many days does a creditor have to acknowledge your written complaint about a billing error?
    a. 30 days
    b. 60 days
    c. 90 days
    d. 120 days
  8. Negative financial information (excluding bankruptcy) can stay on your credit report for:
    a. 2 years
    b. 5 years
    c. 7 years
    d. 10 years
  9. What do “points” refer to in the home mortgage application process:
    a. One point equals 1% of the purpose price, paid to the seller
    b. One point equals 1% of the purchase price, paid to the lender
    c. One point equals 1% of the loan amount, paid to the seller
    d. One point equals 1% of the loan amount, paid to the lender
  10. Each state has a law that lets pharmacists substitute less expensive generic drugs for many brand
    name products.
  11. By using unit pricing at the grocery store, you can easily compare the cost of any brand and any
    package size.
  12. The recommended gasoline for most cars is regular octane.
  13. All telephone numbers that begin with an “8” are toll-free.
  14. In financial transactions, a CD is a:
    a. Certificate of Debt
    b. Certificate of Deposit
    c. Citizens Deposit
    d. Certificate of Collateral
  15. The “Rule of 72” tells you how long it will take to double your money.


  1. (C) A credit report is a loan and bill payment history.
    It is kept by a credit bureau and used by financial institutions and other potential creditors to determine
    how likely it is that you will repay a future debt. Information in your credit report can affect your ability to
    get a job, a loan, a credit card, or insurance.
  2. (A) It stands for Annual Percentage Rate.
    The APR is a measure of the cost of credit, expressed as a yearly interest rate. Usually, the lower the
    APR, the better for you.
  3. (D) No one.
    Your investments in the stock market are not insured. Know the risks before investing in the stock market.
  4. False.
    The law does not require dealers to give buyers a three-day right to cancel. The right to return the car in a
    few days for a refund exists only if the dealer grants this privilege to buyers, but it is discretionary. Dealers
    may describe the right to cancel as a “cooling off” period, a money-back guarantee, or a “no questions
    asked” return policy. Before you purchase a new or used car from a dealer, ask about the dealer’s return
    policy, get it in writing, and read it carefully.
  5. True.
    Your premium is based in part on the car’s sticker price, the cost to repair it, its overall safety record, and
    the likelihood of theft. Many insurers offer discounts for features that enhance safety or prevent theft.
    These include airbags, antilock brakes, daytime running lights, and antitheft devices. Some states
    require insurers to give discounts for cars equipped with airbags or antilock brakes.
  6. (D) All of the above.
    Reverse mortgages allow consumers over age 62 to convert the equity in their homes to cash while
    retaining ownership. With a reverse mortgage, you receive money from the lender and generally don’t
    have to pay it back for as long as you live in your home. In return, the lender holds some–if not most or
    all–of your home’s equity.
  7. (A) The creditor has 30 days.
    The creditor must acknowledge your complaint in writing within 30 days after receiving it, unless the
    problem has already been resolved. The creditor must resolve the dispute within two billing cycles (but
    not more than 90 days) after receiving your letter.
  8. (A) You are responsible for up to $50.
    Your maximum liability under federal law for unauthorized use of your credit card is $50. If you report the
    loss or theft before your credit cards are used, the Fair Credit Billing Act says the card issuer cannot hold
    you responsible for any unauthorized charges. If a thief uses your cards before you report them missing,
    the most you will owe for unauthorized charges is $50 per card. If the loss or theft involves your credit
    card number, but not the card itself, you’re not responsible for unauthorized use.
  9. (D) Points are fees you pay the lender for the loan.
    One point equals 1% of the loan amount. Points usually are paid in cash at closing. In some cases, you
    may borrow the money you need to pay points, but doing so will increase the loan amount and your total
  10. True.
    Each state has a law that lets pharmacists substitute less expensive generic drugs for many brand-names
    products and, depending on your prescription needs, your savings could be significant.
  11. True.
    Unit pricing is a tool for comparing prices. While the package price tells you how much you pay for a food
    item, the unit price tells you the price of each unit in a package. A unit can be an ounce, a pound, a quart,
    a square foot, or an individual piece in a package. For example, the unit price shows you the cost of each
    ounce in a can of soup. The package price just tells you the price of the whole can. Unit pricing helps you
    compare the costs of different brands and various sizes without doing arithmetic. But remember, compare
    only similar items.
  12. True.
    In most cases, manufacturers recommend using regular octane gasoline, and using a higher octane
    gasoline than your owner’s manual recommends offers absolutely no benefit. Unless your engine is
    knocking, buying higher-octane gasoline is a waste of money. Premium gas costs 15 cents to 20 cents
    more a gallon than regular. That can add up to $100 or more a year in extra costs. Studies indicate that
    altogether, drivers may be spending hundreds of millions of dollars each year for higher octane gas than
    their cars need.
  13. False.
    To date, only numbers that begin with 800, 888, 877, or 866 are free. And even then, there are some
    exceptions: Companies that provide audio entertainment or information services may charge for calls to
    800, 888, and other toll-free numbers, but only if they follow the Federal Trade commission’s Pay-Per-Call
    Rule. In addition, some area codes begin with an 8. For example, area code 809 serves the
    Dominican Republic. If you dial this area code, you’ll be charged international long-distance rates.
  14. (B) In financial transactions, a CD is a Certificate of Deposit.
    A CD in this case is a type of savings account that earns a fixed interest rate over a specified period of
    time. At a credit union, it is called a share certificate of deposit, which earns dividends.
  15. True.
    The “Rule of 72” tells you how long it will take to double your money. To use the “Rule of 72,” divide 72 by
    the interest rate you’re getting. For example, if you deposit $3,000 into an account with a 2% interest rate,
    divide 72 by two. The answer–36–tells you that you will double your money in 36 years; in 36 years, you
    will have $6,000.
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Q. What kinds of inquiries are made in financial interviews?

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Q. What is the fundamentals of finance?

It presents key concepts and principles necessary in making investment and financing decisions as well as the fundamental structure and instruments for financial analysis, planning, and control. The training also covers the basics of personal finance and investments.

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