Module 04 Quiz

  1. Which of the following is generally a good reason to go into debt? Choose all that apply.
  2. If you are saving 25% of your after-tax income, how many years will it take to save up for one year's worth of expenses? Ignore possible investment returns.
  3. Unwise Uma borrowed $1000 at some positive interest rate for present consumption, which did not result in increases in future income. This debt needs to be repaid sometime over the next 5 years.

    What is the net effect of this debt on the average annual consumable income for Uma over the next 5 years?

  4. True or False: Federal and state taxes can significantly reduce your net take-home pay.
  5. Which of the following is the largest expense category in the average US household budget?
  6. Which of the following is the first step in the budgeting process?