MCVSD Business & Finance Fundamentals 2

Question 1

What is 'gross income' in personal finance?

Accepted Answer

Income before any taxes or deductions

Answer

Income after taxes and deductions

Answer

Only investment income

Answer

Employer benefits value

Question 2

Which financial concept describes spreading investments across different assets to reduce risk?

Accepted Answer

Diversification

Answer

Liquidity

Answer

Depreciation

Answer

Inflation

Question 3

What is the purpose of a W-2 form in the United States?

Accepted Answer

To report annual wages and taxes withheld from employees

Answer

To apply for a business loan

Answer

To file for unemployment benefits

Answer

To register a new business

Question 4

In business, what does ROI stand for?

Accepted Answer

Return on Investment

Answer

Rate of Income

Answer

Revenue or Interest

Answer

Ratio of Inflation

Question 5

Which type of business structure offers personal liability protection to its owners while allowing pass-through taxation?

Accepted Answer

Limited Liability Company (LLC)

Answer

Sole proprietorship

Answer

General partnership

Answer

C-Corporation

Question 6

What is compound interest?

Accepted Answer

Interest earned on both the principal and previously accumulated interest

Answer

Interest earned only on the principal amount

Answer

A fixed annual fee charged by banks

Answer

Interest paid to creditors monthly