Personal Financial Literacy

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Texas 7th Grade Math › Personal Financial Literacy

Questions 1 - 10
1

A family of four in Austin needs each month: Housing $2,100, Food $800, Transportation $650, Healthcare $400, Other necessities $550.

What is the minimum hourly wage each parent must earn if both parents work 40 hours per week?

19

14

28

13

Explanation

Total monthly budget: $2100+800+650+400+550=4500$. Combined work hours per week: $40+40=80$. Using $4$ weeks per month gives $80\times 4=320$ hours per month. Required hourly wage (each, at the same rate): $4500\div 320=14.0625\approx$ $14.06$. Higher Austin housing costs raise the needed wage compared with some cities.

2

Sarah buys items totaling 45.60 dollars with 8.25% sales tax. What is the total amount Sarah pays?

53.85 dollars

83.22 dollars

49.36 dollars

45.60 dollars

Explanation

Sales tax is applied to the purchase subtotal. Compute the tax: $45.60 \times 0.0825 = 3.762 \approx 3.76$ dollars. Then add it to the subtotal: $45.60 + 3.76 = 49.36$ dollars total.

3

You are buying 3 identical water bottles that cost 20 dollars each (total 60 dollars). Four stores advertise these promotions:

  • Store A: 25% off all items
  • Store B: Buy 2, get 1 free
  • Store C: 10 dollars off purchases over 40 dollars
  • Store D: 30% off one item only Which incentive saves the most money on this purchase?

Store A

Store B

Store C

Store D

Explanation

Compute savings on a 60-dollar purchase of three 20-dollar items:

  • Store A: 25% of 60 dollars is $0.25 \times 60 = 15$ dollars saved.
  • Store B: Buy 2, get 1 free means you pay for only 2 items: save 20 dollars.
  • Store C: 10 dollars off over 40 dollars is 10 dollars saved.
  • Store D: 30% off one item is $0.30 \times 20 = 6$ dollars saved. The greatest savings is 20 dollars at Store B. Decision factors: Buy-2-get-1-free works best when you buy in multiples of three; percent-off applies even if you buy fewer or more items.
4

Simple interest: 1,200 dollars at 3.5% annually for 4 years. What are the total earnings with simple interest?

177.03 dollars

1,368 dollars

168 dollars

42 dollars

Explanation

Simple interest uses $I = prt$. Here $I = 1200 \times 0.035 \times 4 = 168$ dollars. Compound interest (for comparison) uses $A = p(1+r)^t$: $A = 1200(1.035)^4 \approx 1377.03$, so compound interest earned $\approx 177.03$ dollars. Simple interest is on principal only, while compound interest earns interest on interest, so compound grows faster over time. Knowing this helps you choose savings accounts that can grow your money more effectively.

5

Marcus earns 12.50 dollars per hour working 25 hours per week. His income tax rate is 15%. How much income tax does Marcus pay weekly?

46.88 dollars

31.25 dollars

39.06 dollars

265.62 dollars

Explanation

First find weekly earnings: $12.50 \times 25 = 312.50$ dollars. Income tax is a percent of earnings: $312.50 \times 0.15 = 46.875 \approx 46.88$ dollars. Do not subtract unless asked for take-home pay.

6

Basic living costs in Dallas for a family are $4,200 per month.

At $15 per hour, how many combined work hours per month are needed to cover this budget?

320 hours

560 hours

210 hours

280 hours

Explanation

Needed hours: $4200\div 15=280$ hours per month (combined for the household). If two adults worked $40$ hours per week each, that would be $80\times 4=320$ hours per month, which would cover the Dallas budget at this rate. Different cities' costs change the hours needed at a given wage.

7

You are buying 2 identical headphones priced at 80 dollars each (total 160 dollars). Choose the best promotion:

  • Option A: 30% off one item of your choice
  • Option B: Buy 1, get the 2nd for 40% off
  • Option C: 10% off the whole purchase plus a 10-dollar mail-in rebate per headphone (limit 2)
  • Option D: 20 dollars off when you spend 100 dollars or more Which option gives the greatest total savings?

Option A: 30% off one item

Option B: Second at 40% off

Option C: 10% off entire purchase + 10-dollar rebate per item

Option D: 20 dollars off 100 dollars+

Explanation

Regular total is $2 \times 80 = 160$ dollars.

  • A: Save $0.30 \times 80 = 24$ dollars.
  • B: Save 40% on one item: $0.40 \times 80 = 32$ dollars saved.
  • C: Save $0.10 \times 160 = 16$ dollars now, plus rebates: $2 \times 10 = 20$ dollars later; total savings 36 dollars.
  • D: Qualifies for 20 dollars off; save 20 dollars. Greatest savings is Option C (36 dollars). Decision factors: rebates reduce your net cost but arrive later and require submission; percent-off applies immediately; check rebate limits.
8

You invest 2,000 dollars for 5 years at 4%. Option 1: simple interest. Option 2: compounded annually. Which option earns more money over 5 years, and by how much?

Compound interest by 33.31 dollars

Simple interest by 33.31 dollars

They earn the same amount

Compound interest by 400 dollars

Explanation

Simple interest: $I = prt = 2000 \times 0.04 \times 5 = 400$ dollars, so final $= 2400$. Compound interest: $A = p(1+r)^t = 2000(1.04)^5 \approx 2433.31$, so interest $\approx 433.31$ dollars. Difference $\approx 433.31 - 400 = 33.31$ dollars in favor of compound. Simple interest is on principal only; compound earns interest on interest, so it grows faster—useful when comparing savings and investment accounts.

9

An online store sells notebooks for 18 dollars each. You plan to buy 3. Shipping is 8 dollars unless the pre-discount merchandise total is at least 60 dollars (then shipping is free). Four promotions are available:

  • P1: 20% off your order (shipping charged normally)
  • P2: Buy 3, get free shipping only (no item discount)
  • P3: 12 dollars off when you spend 60 dollars or more (based on pre-discount total; you may add a 6-dollar filler item to reach 60)
  • P4: 15% off your order and shipping capped at 4 dollars Which promotion leads to the lowest total cost for this purchase?

P3: Add a 6-dollar filler to reach 60; take 12 dollars off; free shipping

P1: 20% off; pay 8 dollars shipping

P2: Buy 3; free shipping only

P4: 15% off; shipping capped at 4 dollars

Explanation

Base merchandise total: $3 \times 18 = 54$ dollars.

  • P3: Add a 6-dollar item to reach 60 dollars pre-discount ⇒ free shipping. Discount 12 dollars ⇒ total $60 - 12 = 48$ dollars, shipping 0 ⇒ 48 dollars total.
  • P1: 20% off 54 is $0.20 \times 54 = 10.80$ saved ⇒ $54 - 10.80 = 43.20$ dollars; add 8 shipping ⇒ 51.20 dollars total.
  • P2: Free shipping only ⇒ 54 dollars total.
  • P4: 15% off 54 is $0.15 \times 54 = 8.10$ saved ⇒ $54 - 8.10 = 45.90$ dollars; shipping 4 ⇒ 49.90 dollars total. Lowest total is 48 dollars with P3. Decision factors: thresholds are usually based on pre-discount totals; adding a small item can unlock a better discount and free shipping if the net drops more than the filler's cost.
10

A video game costs 59.99 dollars. The sales tax rate is 7.75%. What is the sales tax amount?

64.64 dollars

0.46 dollars

59.99 dollars

4.65 dollars

Explanation

Sales tax is the purchase subtotal times the tax rate: $59.99 \times 0.0775 = 4.649225 \approx 4.65$ dollars. The question asks for the tax amount, not the total price.

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