Test Your Financial Literacy Quotient

Every day, consumers conduct some type of financial transaction that requires an educated decision: shopping for a mortgage or auto loan; understanding and reconciling credit card statements and telephone bills; picking a gym; choosing a retirement plan; comparing health insurance policies; understanding their credit report and how it affects their ability to get credit and at what terms; or deciding whether to pay for a purchase by cash, or credit or debit card. Test your financial literacy with the quiz below. Click the button at the bottom for the answers.

QUESTIONS:

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. True or False: Federal law gives you three days to cancel the purchase of a new or used car from a dealer.
True
False

5. True or False: The type of car you own affects the price you pay for auto insurance.
True
False

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. If your credit card was lost or stolen and used to charge items you didn't authorize, you are responsible for what amount?
A. Up to $50
B. Up $100
C. Up to $500
D. All unauthorized charges

9. Negative financial information can stay on your credit report for:?
A. 2 years
B. 5 years
C. 7 years
D. 10 years

10. What do "points" refer to in the home mortgage application process?
A. Tips
B. Fees you pay the lender for the loan
C. Points of information
D. Rewards to the borrower

11. True or False: Federal law requires that warranties be available for you to read before you buy a product.
True
False

12. True or False: Each state has a law that lets pharmacists substitute less expensive generic drugs for many brand name products.
True
False

13. True or False: By using unit pricing at the grocery store, you can easily compare the cost of any brand and any package size.
True
False

14. True or False: The recommended gasoline for most cars is regular octane.
True
False

15. True or False: All telephone numbers that begin with an "8" are toll-free.
True
False

16. In financial transactions, a CD is a:
A. Certificate of Debt
B. Certificate of Deposit
C. Citizen's Deposit
D. Certificate of Collateral

17. True or False: The "Rule of 72" tells you how long it will take to double your money.
True
False