Economics Foolproof Module 8 notes

Which statement is true?

- It doesn't do much good to have a savings plan if you don't know how to budget your money. - Having a savings plan & a budget won't do much good if you don't know how to spend money wisely.

In this module, we talked about the role of advertising in the free enterprise system. Which is the best answer?

For most companies, the purpose of advertising is to highlight the good things about the company's products or services. It is not the job of those companies to tell you the bad things about their products or services.

Choose the right ways to cut your variable expenses.

Numbers 1, 3, 5, & 6

T/F: According to Foolproof & many consumer groups, if you are from a family with poor money skills, chances are you will have poor money skills as well. Now's the time to take control of your spending habits!

True

According to Foolproof & most consumer groups credit cards have a huge & usually bad impact on a young person's ability to budget & save. Tell us which statement about credit cards are correct.

All of the above.

During the episodes, you kept personal spending records for seven days. You used those records to analyze your spending habits, Which items below would be good reasons to regularly keep track on your personal spending records?

All of the above.

By not negotiating the price of your first car purchase, you have a $1,000 "bad" money burn. How long would it take you to earn back the thousand dollars you just threw away of you take home $10.00 per hour?

100 hours

We have discussed a few ways to increase your income without increasing your work. Choose the options that make sense.

Number 2, 3, & 4

Foolproof talks in depth about the importance of your credit score when it comes to your budget & your savings. Assume your credit score is bad. Which of the following statements are true?

Numbers 1, 2, 3, 4, & 6

Which of the following expenses are usually fixed?

Numbers 2 & 3

According to the Department of Labor finishing even one year of college raises the average person's income a lot for the rest of that person's life.

True

In this module, we talk about the critical thinking skills. You need to work this summer. Next Saturday, you have four choices, Which choice should you make?

You can attend a summer job fair.

We've talked a lot about "fixed" & "variable" expenses. We've talked about the way these expenses impact your budget & your savings. We also talked about one big thing you can do about variable expenses that you cannot usually do about your fixed expenses. What way the big thing you can do?

You can try to lower your variable expenses since it is easier to lower your variable expenses than your fixed expenses.

We talk in depth about critical thinking skills. Assume that you will be moving out on your own in three months. Which of these four choices show the best critical thinking skills?

You decide to attend a meeting of young consumer advocates who will be talking about the problems young people have when they move out on their own.

Which answer illustrates "compound interest"?

You earn interest on the money in your savings account. Then, in addition, you earn interest on the interest.

In this module, we've said that one bill should be paid before all other bills. Which of the four choices should you always pay first? Check the right answer.

You must pay yourself first.

You want a new cell phone. Which of these sources would be the most dependable?

You research "cell phone reviews" & pay a lot of attention to comments from people who don't have anything to do with the cell phone manufacturer.

In this module, we say a "good" money burn means you have spent money wisely. A "bad" money burn means you have spent money you did not need to spend. Tell us which answer shows the best "good" money burn.

You shop around & buy a pair of the exact same designer jeans at a thrift shop, & they cost virtually nothing.

We've talked a lot about impulse buying & its negative impact on both your budget & your savings. Identify each each expense as an "impulse" or "smart" decision.

Numbers 1, 3, 4, 5, & 6 are impulse expenses. Number 2 is a smart expense.

We've talked a lot about "want" versus "need" in this module. Assume you are getting ready to move out of your own. Identify the "want" items.

Numbers 1, 3, 4, 7, & 9

We talk about "doing your homework" before spending any money. You are getting ready to buy your first car. Select all the actions that show you are doing your homework properly.

Numbers 1, 4, & 6

Which of the answers below show bad money burns?

Numbers 2, 3, 4, & 6

In virtually all of the episodes, we talk about the critical importance of never, ever, paying bills late - especially when you are young & you have little credit. Which of the following statements are true?

Numbers 2, 3, 5, 6, & 7

We spent a lot of time talking about the key habits of millionaires when they were in high school. Check the answer identifying the habits we talked about.

Numbers 2, 4, 6, & 7