#1
What is the purpose of a W-2 form?
To report income earned as an employee
ExplanationIncome reporting for employees.
#2
Which of the following is NOT a type of tax?
Health tax
ExplanationNon-existent tax category.
#3
What does APR stand for in finance?
Annual Percentage Rate
ExplanationFinance term for interest rate.
#4
What is the main purpose of a 401(k) retirement account?
To allow tax-deferred contributions
ExplanationTax advantage for retirement savings.
#5
What is the purpose of a Form 1099?
To report dividends and interest income
ExplanationIncome reporting for dividends and interest.
#6
What does the term 'liquidity' refer to in finance?
Ability to convert assets into cash without significant loss
ExplanationEase of converting assets to cash.
#7
What is the purpose of a Form W-4?
To calculate federal income tax withholding
ExplanationDetermines federal income tax withholding.
#8
Which of the following is NOT a characteristic of a traditional IRA?
Earnings grow tax-free
ExplanationEarnings in a traditional IRA are not tax-free.
#9
What is the term for the difference between total revenue and total expenses?
Net income
ExplanationOverall profit after subtracting expenses.
#10
Which of the following is a deductible expense on a tax return?
Home mortgage interest
ExplanationAllowable deduction on taxes for mortgage interest.
#11
Which of the following is a regressive tax?
Sales tax
ExplanationTax that disproportionately affects lower incomes.
#12
What is the purpose of a Roth IRA account?
To allow tax-free withdrawals
ExplanationTax-free withdrawals in retirement.
#13
Which of the following is an example of a capital gain?
Profit from selling stocks for more than their purchase price
ExplanationEarning from selling stocks at a profit.
#14
Which of the following is NOT a type of tax-favored retirement account?
CD
ExplanationCertificate of Deposit is not a retirement account.
#15
What is the term for a loan that uses the borrower's car as collateral?
Title loan
ExplanationLoan secured by the borrower's car.
#16
Which of the following is NOT a type of retirement plan?
529
Explanation529 plan is not a retirement plan.