Ramsey Chapter 2 Post-Test Study Set

On-line budgeting apps are more effective than budgeting with paper and pencil.

O True

O False

False

A written cash flow plan is:

O Impulse Purchase

O Cash Flow Statement

O Budget

O 0verdraft

Budget

Although the majority of Americans think budgeting is important, about ______ of Americans actually use a budget.

O 75%

O 50%

O 35%

O 23%

35%

You should evaluate and change your budget monthly.

O True

O False

True

Dave Ramsey's four walls are food, utilities, shelter, and transportation.

O True

O False

True

Which of the following is not a component of a budget?

O Savings

O Giving

O Income

O Credit Score

Credit Score

Pay yourself first means you should set up an amount for pocket money before paying bills.

O True

O False

False

How many categories should you have in your budget?

O Ten or less

O 15 or more

O Use as many as you need.

O No more than a dozen.

Use as many as you need

Having more than one bank account is never a good idea, because it complicates things.

O True

O False

False

Setting up an automatic account transfer for savings or investing is a bad idea.

O True

O False

False

Rent is what type of expense?

O Fixed Expense

O Variable Expense

O Discretionary Expense

O Intermittent Expense

Fixed Expense

Which of the following would be a discretionary expense?

O Food

O Shelter

O Vacation

O Car Payment

Vacation

Repairs to your car are a...

O Discretionary Expense

O Variable Expense

O Fixed Expense

O Intermittent Expense

Intermittent Expense

The electric bill is a...

O Discretionary Expense

O Variable Expense

O Intermittent Expense

O Fixed Expense

Variable Expense

Which of the following would be a variable expense?

O Car Note

O Rent

O Groceries

O Cable Bill

Groceries

If you are married, then only one person is responsible for the budget

O True

O False

False

The zero-based budget is the best way to design a budget according to Dave Ramsey.

O True

O False

True

Doing a budget:

O makes overspending more likely.

O eliminates having fun.

O makes your money go farther.

O makes you feel guilty.

makes your money go farther

A cash flow statement summarizes all of the income and spending over a certain period.

O True

O False

True

A budget is a written plan for saving and spending.

O True

O False

True

A budget is meant to summarize the saving and spending that has taken place over the past year.

O True

O False

False

What does a budget show you?

O How much you plan to save

O How much money you need to earn

O How much money you spent last month

O How much money you plan to come in and go out each month

How much money you plan to come in and go out each month

Which is something a typical millionaire will do?

O Carry Debt

O Lease a car

O Spend less money than he or she makes

O Replace things that are not broken.

Spend less money than he or she makes

Detail categories on your budget will help you make better spending decisions.

O True

O False

True

A budget says what will happen with your money, while a cash flow statements shows what already happened.

O True

O False

True

Research shows that nearly half of Americans feel stress and anxiety about the amount of ____________ they have.

O Debit Cards

O Money

O Personal Debt

O Categories in their budget

Personal Debt

Your money personality can affect your __________.

O Personal Values

O Ability to Budget

O Attitude toward budgeting

O Choice of Bank

Attitude toward budgeting

How many months does it usually take for a budget to start working as a budget should?

O 0ne month

O Two Months

O Three Months

O Four or more months

Three months

What is a way to stay accountable to reaching your financial goals?

O Finding a person you trust to help keep you on track with your money goals

O Look at the budget you set at the end of the month.

O Hiring a financial advisor to make your decisions about money for you.

O Creating specific categories in your budget.

Finding a person you trust to help keep you on track with your money goals

Why is tracking your expenses throughout the month important

O It helps you pull money from your savings to spend in other categories.

O It is really isn't important in the long run.

O It gives you insight into whether you're sticking to the budget you set.

O It allows you to delete categories you don't like.

It gives you insight into whether you're sticking to the budget you set.

Commission is when you make money based on a percentage of_____

O Investments

O Budgets

O Total Sales

O Items sold

Total Sales

What kind of money counts as income?

O Money in your savings account.

O All money you receive, like money your make from your job and gifts

O 0nly the money you make at your job.

O 0nly money deposited into your checking account.

All money you receive, like money your make from your job and gifts

When is the right time to start creating and living by a budget?

O 0nce you have a job with an income.

O When you decide to buy a car.

O Right now. It's never to early.

O When you start researching colleges ant the cost associated with them.

Right now. It's never to early.

What should you do if you overspend in one of your categories of your budget?

O Adjust your budget by removing money from another category.

O Just leave it. It will probably work out.

O Take money from your giving category.

O Ask a friend for the money you overspent.

Adjust your budget by removing money from another category.

The first priority in your budget should be

O Investing

O Giving

O Saving

O Spending

Giving

The primary reason people do not budget is because they lack the behavior to stick to a budget.

O True

O False

True

What is a good way to make sure that you're creating a budget that's realistic.

O Make sure you create a budget every single day.

O Make sure your budget is perfect before starting it.

O Check your calendar so that you can plan for upcoming monthly expenses.

O Make sure you have enough money in your savings account to pull from.

Check your calendar so that you can plan for upcoming monthly expenses.

The best way for you to budget is .....

O On paper

O Creating a spreadsheet

O By using a digital app

O The way that works best for you.

The way that works best for you

If you have an irregular income, then budgeting will not work for you.

O True

O False

False

Why is budgeting so important?

O It helps you brush up with your math skills.

O It is a good way to make sure all your money is spent by month's end.

O It gives you control of your money and sets you up for financial success.

O it helps you justify a purchase that may not have been necessary.

It gives you control of your money and sets you up for financial success.

The envelope system is a method of budgeting that use envelopes labeled with specific budget categories for your cash.

O True

O False

True

A common misconception is that a budget will keep you from having fun, when in reality a budget ...

O Restricts your fun completely.

O Gives you permission to spend

O Adds more stress to your life.

O Means there are no rules, you can spend your money as you wish.

Gives you permission to spend