Canadian Financial Literacy Quiz. At the end of the quiz you will be given your score and the list of correct answers.

1. If the inflation rate is 5% and the interest rate you get on your savings is 3%, will your
savings have at least as much buying power in a year’s time?

Yes

2. A credit report is…?

A list of your financial assets and liabilities

A monthly credit card statement

A loan and bill payment history

A credit line with a financial institution

3. Who insures your stocks in the stock market?

The National Deposit Insurance Corporation

The Securities and Exchange Commission

The Bank of Canada

No one

4. True or false. By using unit pricing at the grocery store, you can easily compare the cost
of any brand and any package size.

True

False

5. If each of the following persons had the same amount of take home pay, who would
need the greatest amount of life insurance?

A young single woman with two young children

A young single woman without children

An elderly retired man, with a wife who is also retired

A young married man without children

6. If you had a savings account at a bank, which of the following statements would be
correct concerning the interest that you would earn on this account?

Sales tax may be charged on the interest that you earn

You cannot earn interest until you pass your 18th birthday

Earnings from savings account interest may not be taxed

Income tax may be charged on the interest if your income is high enough

7. Inflation can cause difficulty in many ways. Which group would have the greatest
problem during periods of high inflation that lasts several years?

Young working couples with no children

Young working couples with children

Older, working couples saving for retirement

Older people living on fixed retirement income

8. Lindsay has saved $12,000 for her university expenses by working part-time. Her plan is
to start university next year and she needs all of the money she saved. Which of the
following is the safest place for her university money?

Corporate bonds

Mutual Funds

A bank savings account

Locked in a safe at home

Stocks

9. Which of the following types of investment would best protect the purchasing power of
a family’s savings in the event of a sudden increase in inflation?

A twenty-five year corporate bond

A house financed with a fixed-rate mortgage

A 10-year bond issued by a corporation

A certificate of deposit at a bank

10. Under which of the following circumstances would it be financially beneficial to borrow
money to buy something now and repay it with future income?

When something goes on sale

When the interest on the loan is greater than the interest obtained from a savings account

When buying something on credit allows someone to get a much better paying job

It is always more beneficial to borrow money to buy something now and repay it with future income

11. Which of the following statements is not correct about most ATM (Automated Teller
Machine) cards?

You can get cash anywhere in the world with no fee

You must have a bank account to have an ATM card

You can generally get cash 24 hours-a-day

You can generally obtain information concerning your bank balance at an ATM machine

12. Which of the following can hurt your credit rating?

Making late payments on loans and debts

Staying in one job too long

Living in the same location too long

Using your credit card frequently for purchases

13. What can affect the amount of interest that you would pay on a loan?

Your credit rating

How much you borrow

How long you take to repay the loan

All of the above

14. Which of the following will help lower the cost of a house?

Paying off the mortgage over a long period of time

Agreeing to pay the current rate of interest on the mortgage for as many years as possible

Making a larger down payment at the time of purchase

Making a smaller down payment at the time of purchase

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Canadian Financial Literacy Quiz – These questions were asked as part of the Canadian Financial Capability Survey (CFCS). The 2009 study included 8,319 individuals aged 18 to 64.

At the end of the Canadian Financial Literacy Quiz you will be given your score, the list of answers and the average score of the people who took the original test.

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Canadian Financial Literacy Quiz