|Name: _________________________||Period: ___________________|
This test consists of 15 multiple choice questions and 5 short answer questions.
Multiple Choice Questions
1. People should have enough savings to cover expenses for how long?
(a) Nine months.
(b) One year.
(c) Six months.
(d) Four months.
2. What is the crossover point?
(a) When the amount of investment income is lower than normal monthly expenses.
(b) When the amount of investment income is as high as normal monthly expenses.
(c) When the amount of total income is as high as normal monthly expenses.
(d) When the amount of total income is lower than normal monthly expenses.
3. Prestige, status, and power can be reasons for what?
(a) Choosing a certain job.
(b) Early retirement.
(c) Retaining life energy.
(d) Keeping up with the neighbors.
4. If people invest more money each month, what happens to the monthly interest?
(a) The interest becomes tax-deductible.
(b) The interest increases each month.
(c) The interest decreases each month.
(d) The interest must be withdrawn from the account.
5. A line should be drawn connecting the current month's income to what?
(a) The previous month's expenses.
(b) The current month's expenses.
(c) The previous month's income.
(d) The previous year's income.
6. Why do people feel very free when volunteering?
(a) Because they do not have to be there, and can do things their way.
(b) Volunteer work is unpaid.
(c) Volunteering can lead to job offers.
(d) Volunteering requires no skill.
7. What is the most important strategy in following Step 7?
(a) Following a passion.
(b) Conserving life energy.
(c) Choosing a job with high pay.
(d) Reducing monthly expenses.
8. If "work" is different from "paid employment," then which of the following is true?
(a) Volunteer jobs are not work.
(b) Cleaning is only work when it's done by a paid professional.
(c) Retirement is the absence of work.
(d) Work includes anything people do to provide a service, including cleaning the house.
9. What encourages family, friends, and neighbors to support the participant's goals in following this program?
(a) Making wall charts for them to use.
(b) Asking them for a loan.
(c) Placing the wall chart in a public place.
(d) Making retirement plans with them.
10. What should frugal people research before purchasing items?
(a) Value, quality, durability, and multiple use.
(b) Value, quality, and availability.
(c) Popularity, quality, durability, and multiple use.
(d) Color, style, and multiple use.
11. How should investment income be tracked?
(a) Combined with monthly expenses.
(b) Subtracted from monthly expenses.
(c) Separately from other income.
(d) Combined with other income.
12. The top number on the y-axis should be at least how large?
(a) Equal to the participant's expected income.
(b) Twice as large as the participant's expected expenses.
(c) Twice as large as the participant's expected income.
(d) Three times as large as the participant's expected income.
13. Participants should always remain conscious of what?
(a) Life energy.
(b) All the job opportunities around them.
(c) Impending retirement.
14. The wall chart's time span is a rough deadline for what?
(b) Finding a new career.
(c) Achieving financial independence.
(d) Finding a life purpose.
15. What should a participant plot on their wall chart each month?
(a) Income and expenses.
(b) Life energy spent.
(c) Hours worked.
(d) All purchases.
Short Answer Questions
1. The numbers along the y-axis should increase by what increment?
2. What are some good alternatives to buying what is needed?
3. If people earn more than the minimum needed to pay bills, what should they do with the extra money?
4. What should people do about unusual extra expenses, such as medical bills or birthday parties?
5. What mistake do people often make, when describing their jobs?
This section contains 613 words
(approx. 3 pages at 300 words per page)