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Time to wrap up your financial literacy test

Smart with money: find out if you pass the grade on financial matters with these questions posed by Martha Harris Myron in the concluding part of her annual financial literacy test

Last week we posted the first part of the annual Bermuda financial literacy test. Here is the second and final section for those brave souls who want to stress their brains this weekend.

The total test of 25 questions is relatively easy compared to the Cambridge Secondary full test samples, as well as questions from other sources, including OECD PISA, PAARC, US NEFE, and FINRA.

Not included was any statistical analysis — a very necessary maths skill for probability solving in international insurance business — fractions, integers, negative numbers, equations, present and future value, and geometry. We didn’t want a wholesale revolt by our highly cherished readers. But, hint, you may need to ask your sixth grade student, or grandchild for help.

Some questions are not maths-focused but are instead on Bermuda’s financial planning environment.

Questions one to 14 can be found at The Royal Gazette last week. There is a link at the end of this article.

Please note some questions have more than one right answer. You certainly can use a calculator or Google math, but keep in mind that students must learn maths the old-fashioned way, calculating by hand.


15. George banks with ZedBank. He receives this e-mail message.

Dear ZedBank member. There has been an error on the ZedBank server and your internet login details have been lost. Your account is no longer secure. Please click on the link below to provide your details and restore access. https://ZedBank.com/

Which of these statements would be good advice for George?

a. Reply to the e-mail message and provide his internet banking details.

b. Contact his bank to inquire about the e-mail message.

c. If the link is the same as his bank’s website address, click on the link and follow the instructions.

16. You have not made a will. If you die suddenly:

a. The Bermuda Government will decide who gets your Bermuda assets.

b. Your ex-husband will inherit your Bermuda National Pension as he is listed as the beneficiary.

c. Your current spouse will inherit all your assets as next of kin.

17. Put one set of brackets in each calculation to make the answer correct.

a. 4 + 9 X 6 - 4 = 22 Answer A solution

b. 24 ÷ 12 - 8 + 2 = 4 Answer B solution

18. Your variable mortgage is amortised. This means that:

a. You pay the same cash amount each month.

b. Your interest amount is the same each month.

c. Your principal payment is the same each month.

d. Each month the amount of your principal payment goes up and the amount of interest goes down.

19. Lemons cost $5.40 per kilogram. Leyla buys 0.35kg of lemons. Calculate how much Leyla’s lemons will cost.


20. Your life insurance states you have a cash value. It is

a. A term policy.

b. An annuity policy.

c. An accumulation over time.

d. A whole of life policy.

21. You’ve invested in a fast-rising stock: original cost $20, now worth $50 at the end of the year. This represents an annual:

a. 2.5 per cent appreciation

b. 250 per cent appreciation

c. 150 per cent appreciation

d. a dividend of $7.50 a quarter

22. A teacher has three hours to grade all the papers submitted by the 35 students in her class. She gets through the first five papers in 30 minutes. How much faster does she have to work to grade the remaining papers in the allotted time?

a. 10 per cent

b. 15 per cent

c. 20 per cent

d. 25 per cent

e. 30 per cent

23. Your credit card company charges 20 per cent, compounded annually. Your balance is $5,000 after splurging on a vacation and some treats. You are stressed and can only pay $100 per month for the next few years.

a. You can pay off the balance in two years.

b. You will pay off the balance in five years.

c. You will never pay off the remaining balance.

d. You will pay for your handbag twice: once for actual cost, the second in credit card interest.

24. You are ready to retire. Your retirement counsellor advises you to convert your retirement accounts to a fixed annuity. This represents:

a. Your cash invested in capital markets.

b. A cash transfer to your insurance company.

c. A monthly payment to you of your cash plus interest for a fixed term.

d. A liability to the insurance company.

25. John buys 100 shares of stock at $100 per share. The price goes up by 10 per cent and he sells 50 shares. Then, prices drop by 10 per cent and he sells his remaining 50 shares. How much did he get for the last 50?

a. $5000

b. $5500

c. $4900

d. $5050

e. $4950

There you have it. Take the maths challenge and see how you do. Send me your answers if you like, and/or your frustrations to martha.myron@gmail.com.

Answers will be discussed in about a month’s time.

Needing help? Those of us who learnt and have forgotten maths processes, take the refresher course at the website “Skills You Need”. https://goo.gl/rrnxj3

This is a wonderful website featuring numerous skill spruce up exercises, including personal, interpersonal, presentation, leadership, writing (CVs etc), numeracy (maths refreshers) and parenting skills.

Skills You Need content is not only used by individuals but also by schools, colleges, universities and commercial organisations around the world. Skills You Need is part of the UK Web Archive, archived by the National Library of Wales.


The first part of the test can be found here: https://goo.gl/K8cR2r

Martha Harris Myron CPA CFP JSM: Masters of Law — international tax and financial services. Pondstraddler Life, financial perspectives for Bermuda islanders with multinational families and international connections on the Great Atlantic Pond. Contact: martha@pondstraddler.com