Money Basics: Checkpoint 2

Covers goal-setting, paychecks, and how taxes work.

Five questions on setting real financial goals, reading a paycheck, and how progressive taxes work.

Question 1 of 5 In the SMART goal framework, what does the 'M' stand for?

Motivating Measurable Manageable Monthly

Question 2 of 5 Net income is best described as:

Your salary before any deductions What's left after taxes and other deductions Your total lifetime earnings The interest your paycheck earns

Question 3 of 5 A budget built around gross income instead of net income tends to be:

More accurate Too optimistic Illegal Only useful for taxes

Gross income doesn't reflect deductions like taxes, so a budget based on it assumes more spendable money than you actually have.

Question 4 of 5 In a progressive tax system, a higher tax bracket applies to:

Your entire income Only the portion of income that falls within that bracket Only income earned after age 30 Only investment income

Question 5 of 5 Your 'effective tax rate' is:

The rate on your very last dollar earned Your total tax divided by your total income Always higher than your marginal rate Set by your employer

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