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Quizzes > Business & Finance

Financial Literacy Quiz for High School Students

Quick, free quiz with personal finance questions. Instant results.

Editorial: Review CompletedCreated By: Emily DunlapUpdated Aug 23, 2025
Difficulty: Moderate
2-5mins
Learning OutcomesCheat Sheet
paper art illustration of quiz with financial literacy icons for high school budgeting taxes on coral background

This financial literacy quiz helps high school students practice real-life money skills like budgeting, saving, and taxes, and see what to study next. After you finish, try a wise financial literacy test, take a personal finance quick check, or build basics with a finance basics test for more practice.

What is a budget?
A plan for spending and saving money
A type of bank account
An insurance policy
A loan you must repay
A budget is a plan for how to allocate income toward expenses and savings. It helps individuals track spending and set financial goals. By budgeting, people ensure they don't overspend.
Which of the following is considered a fixed expense?
Movie tickets
Dining out
Groceries
Rent payment
A fixed expense remains constant each period, such as rent, and does not fluctuate with usage or consumption. Knowing your fixed and variable expenses helps you plan your monthly budget more accurately.
Which of these is a bank account used for everyday transactions?
Certificate of deposit
Checking account
Money market fund
Savings account
Checking accounts are designed for daily transactions like paying bills and making purchases, often with debit cards or checks. They typically offer easy access to funds but pay little to no interest.
Which describes an emergency fund?
Money set aside for unexpected expenses
Funds invested in the stock market
A credit card balance
A retirement account
An emergency fund is cash reserved to cover unexpected costs like medical bills or car repairs without using credit. It helps maintain financial stability in crises.
What is the main difference between a debit card and a credit card?
Credit requires a bank account; debit does not
Debit builds credit score; credit cannot
Debit offers rewards; credit does not
Debit draws from existing funds; credit borrows money
Debit cards withdraw directly from checking accounts, while credit cards allow you to borrow up to a set limit and pay later. Credit cards may also involve interest charges if not paid in full.
What does it mean to live within your means?
Ignoring bills until due dates
Taking out loans to fund lifestyle
Spending less than or equal to your income
Relying on credit cards for necessities
Living within your means ensures you don't spend more than you earn, which helps prevent debt and financial stress. It's a key principle for long-term financial health.
Why is it important to set financial goals?
Allows spending without a plan
Guarantees high investment returns
Provides direction and motivation to save and invest
Ensures you can avoid all taxes
Setting financial goals helps individuals plan saving, track progress, and stay motivated toward achieving milestones like buying a car or paying tuition. It also aids in prioritizing spending.
Which is considered a 'want' rather than a 'need'?
Nutritious food
Basic housing
Utilities like water
Designer clothing
Wants are non-essential items individuals desire but can live without, whereas needs are necessary for basic living standards. Differentiating helps prioritize spending.
What does 'interest' mean when talking about savings?
A loan from a friend
Fee charged for withdrawing cash
Payment from a bank for keeping money on deposit
Penalty for late credit card payment
Banks pay interest on savings accounts as compensation for the use of deposited funds. It's usually expressed as an annual percentage rate.
How does compound interest differ from simple interest?
Compound interest is earned on principal and accumulated interest
Simple interest earns on interest only
Compound interest pays a flat fee
Simple interest compounds more frequently
Compound interest earns on both the original principal and the interest that accumulates over time, accelerating growth. Simple interest is calculated only on the principal.
Which factor does NOT affect your credit score?
Payment history
Credit utilization
Length of credit history
Favorite color
Credit scores are based on financial behaviors and credit use; personal preferences like favorite color have no impact. Key factors include payment history, utilization, and account age.
What is the purpose of a credit report?
Shows tax returns filed
Lists monthly grocery expenses
Details retirement savings
Records an individual's credit history for lenders
Credit reports compile borrowing and repayment records to inform lenders about an individual's creditworthiness. They don't include tax filings or daily expenses.
How does inflation impact purchasing power?
Eliminates all debt
Reduces the value of money over time
Stops prices from changing
Increases the nominal value of cash
Inflation means general price increases over time, which reduces how much goods and services money can buy. Holding cash without earning interest can erode purchasing power.
Which type of tax is deducted directly from your paycheck?
Property tax
Payroll tax
Sales tax
Excise tax
Payroll taxes, such as Social Security and Medicare, are withheld by employers from employee paychecks before disbursing earnings. Property and sales taxes are collected differently.
What is the benefit of a 529 college savings plan?
No contribution limits
Guaranteed high returns
No investment risk
Tax-free growth for education costs
529 plans allow investments to grow tax-free when used for qualified education expenses at eligible institutions. They can also offer state tax incentives.
How does an ATM fee work?
Interest paid on ATM withdrawals
Tax on bank accounts
Incentive for using in-network ATMs
Charged by banks for transactions at out-of-network ATMs
Out-of-network ATM fees are charged when customers use ATMs not owned by their bank, covering maintenance and network costs. Using in-network ATMs usually avoids these fees.
What is the role of diversification in investing?
Maximizes fees for brokers
Focuses on one stock
Spreads risk across multiple assets
Guarantees returns
Diversification reduces exposure to any single investment's losses by holding a variety of assets, potentially smoothing returns and lowering risk.
What does 'APR' represent?
Annual Percentage Rate
Average Payment Ratio
Annual Paid Return
Automatic Payment Requirement
APR stands for Annual Percentage Rate and represents the yearly cost of borrowing or the yearly income from an investment, including fees. It allows comparison of credit products.
If you invest $1,000 at 5% annual compound interest, how much will you have after two years?
$1,105.00
$1,102.50
$1,100.00
$1,115.00
Compound interest is calculated as principal multiplied by (1 + rate) squared for two years: 1000 × (1.05)^2 = 1102.50. This shows interest earning on prior interest.
What is the typical credit card grace period?
The time before interest accrues if balance is paid in full, often 21-25 days
5 days
60 days
Immediately after charge
Many credit cards offer a grace period, typically 21 - 25 days, during which no interest accrues if the cardholder pays the full balance by the due date. It encourages prompt payment.
What does opportunity cost refer to?
Value of the next best alternative foregone
Tax owed on interest income
Extra fees on a loan
Profit from an investment
Opportunity cost measures what you sacrifice by choosing one option over the next best alternative, helping guide financial decisions. It's a fundamental economic concept.
What is an amortization schedule?
A savings plan calendar
A table detailing loan payments, interest and principal over time
A stock performance chart
A list of credit card balances
An amortization schedule breaks down each loan payment into interest and principal portions and shows the remaining balance after each payment until the loan is paid off.
What does a tax bracket indicate?
The deadline for filing taxes
The total tax owed for the year
The number of deductions you have
The range of income taxed at a specific marginal rate
Tax brackets define income ranges that are taxed at different marginal rates, determining the rate applied to each portion of taxable income.
Which best describes a Roth IRA?
A high-interest savings account
Contributions tax-deductible, withdrawals taxed
Employer-sponsored pension plan
Contributions taxed now, withdrawals tax-free later
Roth IRAs are funded with after-tax dollars, so qualified withdrawals during retirement are tax-free. They differ from traditional IRAs, which are tax-deductible on contribution.
How is bond yield generally calculated?
Face value divided by coupon rate
Total principal paid over life
Number of years to maturity
Annual interest payment divided by current market price
Yield equals the annual coupon payment divided by the bond's current price, reflecting the return an investor would earn if the bond were purchased today.
What type of insurance covers liability for injuries to others in a car accident?
Comprehensive coverage
Bodily injury liability
Collision coverage
Uninsured motorist coverage
Bodily injury liability insurance pays for medical expenses and legal fees if you're responsible for injuring others in an auto accident. It's a required coverage in most states.
How do marginal and average tax rates differ?
Marginal rate applies to all income; average applies to last dollar
One is for investments; the other for wages
Marginal rate applies to the last dollar of income; average rate is total tax divided by total income
They are always the same
The marginal rate is the rate paid on the next dollar of income, while the average rate is the overall percentage of income paid in taxes. They differ because of progressive tax brackets.
In net present value (NPV) calculations, what does discounting future cash flows represent?
Increasing future cash flows for inflation
Adjusting future money to present value based on time value of money
Calculating loan interest only
Converting assets to liabilities
Discounting reflects that money available now is worth more than the same amount in the future, adjusting for risk and time preferences. It's critical for evaluating investment projects.
What distinguishes tax avoidance from tax evasion?
Evasion uses legal deductions; avoidance hides income
There is no difference
Avoidance uses legal strategies to minimize taxes; evasion is illegal
Both are illegal practices
Tax avoidance employs lawful methods, such as deductions and credits, to reduce tax liability. Tax evasion involves illegal actions like underreporting income or fabricating deductions.
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Study Outcomes

  1. Understand Key Budgeting Concepts -

    Learn how to allocate limited funds, track spending, and craft a basic budget framework through our financial literacy questions for high school students.

  2. Apply Smart Saving Strategies -

    Discover practical techniques for setting financial goals, distinguishing needs from wants, and building savings habits using this money management quiz for high school.

  3. Analyze Personal Finance Scenarios -

    Evaluate real-world situations to make informed decisions about spending, saving, and borrowing in a personal finance trivia for students format.

  4. Explain Fundamental Tax Principles -

    Identify common types of taxes, understand basic deductions, and see how taxes impact take-home pay in our budgeting quiz for teenagers context.

  5. Calculate Interest and Growth -

    Gain confidence computing simple interest, comparing savings options, and projecting account growth in a fun financial literacy quiz for teens.

Cheat Sheet

  1. 50/30/20 Budget Rule -

    The University of Illinois Extension's 50/30/20 framework splits income into 50% needs, 30% wants, and 20% savings or debt repayment, offering a clear blueprint for a money management quiz for high school learners. Tracking your allowance or paycheck with this rule builds a habit of balanced spending before you take a budgeting quiz for teenagers. Try mapping last month's expenses into these three buckets to see where you can adjust.

  2. Simple vs. Compound Interest -

    According to Federal Reserve Education, simple interest uses I = P × R × T, while compound interest follows A = P(1 + r/n)^(n×t), which can grow savings faster - a key topic in personal finance trivia for students. Understanding the power of "interest on interest" helps you predict how small deposits can double over time. Use a free online calculator to compare both formulas with your own numbers.

  3. Emergency Fund & Pay Yourself First -

    The National Endowment for Financial Education (NEFE) recommends "pay yourself first" by setting aside at least 10% of income into an emergency fund before any other spending - perfect practice for any financial literacy quiz for teens. An emergency fund covering 3 - 6 months of basic expenses provides a safety net for unexpected costs like car repairs or medical bills. Automate transfers into a separate savings account so you never skip this crucial step.

  4. Credit Scores & Smart Borrowing -

    The Consumer Financial Protection Bureau (CFPB) highlights that payment history, credit utilization, and account age are key factors in your credit score - vital knowledge when tackling financial literacy questions for high school students. Keeping utilization under 30% on a card and paying balances in full monthly helps you avoid high interest charges. Checking your free annual credit report ensures there are no errors dragging your score down.

  5. Needs vs. Wants: The WAFT Test -

    The FDIC's Money Smart program suggests the WAFT mnemonic (Willingness, Affordability, Frequency, Timing) to separate needs from wants - an essential skill for acing a budgeting quiz for teenagers. Before making a purchase, ask if you're willing to delay it, whether you can afford it, how often you'll use it, and if the timing is right. This quick test sharpens spending decisions and prevents impulse buys.

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