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Quiz: Are You Smarter Than a 12th Grader?

By Kimberly Palmer

Posted April 2, 2008

Every two years, the Jump$tart Coalition for Personal Financial Literacy tests 12th graders' practical money knowledge. The average score usually hovers around 52 percent. You can test yourself on these sample questions from the 2006 survey.

Matt and Eric are young men. Each has a good credit history. They work at the same company and make approximately the same salary. Matt has borrowed $6,000 to take a foreign vacation. Eric has borrowed $6,000 to buy a car. Who is likely to pay the lowest finance charge?
1. Matt will pay less because people who travel overseas are better risks.
2. They will both pay the same because they have almost identical financial backgrounds.
3. Eric will pay less because the car is collateral for the loan.
4. They will both pay the same because the rate is set by law.
Many savings programs are protected by the federal government against loss. Which of the following is not?
1. A bond issued by one of the 50 states
2. A U. S. Treasury bond
3. A U. S. savings bond
4. A certificate of deposit at the bank
Which of the following statements is true?
1. Your bad loan payment record with one bank will not be considered if you apply to another bank for a loan.
2. If you missed a payment more than two years ago, it cannot be considered in a loan decision.
3. Banks and other lenders share the credit histories of their borrowers with each other and are likely to know of any loan payments that you have missed.
4. People have so many loans it is very unlikely that one bank will know your history with another bank.
Doug must borrow $12,000 to complete his college education. Which of the following would NOT be likely to reduce the finance charge rate?
1. If his parents took out an additional mortgage on their house for the loan.
2. If the loan was insured by the federal government.
3. If he went to a state college rather than a private college.
4. If his parents cosigned the loan.
If you had a savings account at a bank, which of the following would be correct concerning the interest that you would earn on this account?
1. Sales tax may be charged on the interest that you earn.
2. You cannot earn interest until you pass your 18th birthday.
3. Earnings from savings account interest may not be taxed.
4. Income tax may be charged on the interest if your income is high enough.
Kelly and Pete just had a baby. They received money as baby gifts and want to put it away for the baby's education. Which of the following tends to have the highest growth over periods of time as long as 18 years?
1. A U.S. government savings bond
2. A savings account
3. A checking account
4. Stocks

See the correct answers >>

Tags: personal finance | financial literacy

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