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Personal Finance Level 1
Sample Paper
This is a Sample Paper for the Personal Finance Qualification which includes sample
questions for all 3 units.
A number of possible answers are given for each multiple-choice question. Each multiplechoice question has only ONE correct answer.
Calculators can be used to work the answers out.
Tasks
1.
Karen has been working in an accountant’s office for the last three months.
She works 25 hours a week and gets paid £7 an hour.
Karen has been off sick for the last 2 weeks with bronchitis.
Decide if each of the following statements is TRUE or FALSE.
a. Karen is being paid less than the national minimum wage.
b. Karen has not been at the firm long enough to qualify for Statutory
Sick Pay.
2.
Which of the following government departments can you complain to if your
employer is not paying the national minimum wage?
A. HM Treasury.
B. HM Revenue and Customs.
C. Jobcentre Plus.
D. The Pension Service.
3.
You want to repay some money lent to you by a friend, using automatic
instalments.
Which of the following bank features would be most appropriate to do this?
A. Cash card.
B. Direct debit.
C. Standing order.
D. Debit card.
Personal Finance Sample Paper
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4.
Josh and Nicole are working out their monthly budget.
Using the quarterly gas bill below, how much should they budget for gas per
month?
Win Gas
Billing Summary
Billing period 6 April to 26 June
Gas you have used
First 100kWh @ 4.332p
42.80
2438.69kWh @ 2.207p
60.06
TOTAL
102.86
Discounts
0.00
VAT
17.14
Balance due
120.00
A. £10.00.
B. £20.00.
C. £30.00.
D. £40.00.
5.
Which of the following is most likely to be the cheapest way to pay a fixed
line telephone bill?
A. Cash at a bank.
B. Cheque by post.
C. Direct debit.
D. Prepayment meter.
6.
Malcolm and Sandra are working out their weekly budget.
How would you describe their budget?
Income (after tax & other
deductions)
Wages – Malcolm
Tax credits
Child benefit
Housing benefit
TOTAL
£a
week
218.00
63.00
18.00
45.00
344.00
Expenditure
Food etc
Rent & council tax
Fuel bills
TV licence
Car – petrol,
insurance etc
Other
£a
month
95.00
140.00
20.00
3.00
35.00
40.00
333.00
A. Shortfall of £9.00.
B. Shortfall of £11.00.
C. Surplus of £9.00.
D. Surplus of £11.00.
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7.
Chris and Ava have just bought their first home together.
They used all their savings for the deposit and took out a fixed-rate
mortgage.
If the general level of interest rates rise how will their budget be affected?
A. Their budget will get worse.
B. There will be no change to their budget.
C. Their budget will improve.
8.
Which of the following types of debt should be your highest priority?
A. Bank overdraft.
B. Council tax.
C. Hire purchase for television.
D. Gas bill.
9.
Which of the following organisations offer free, independent help sorting out
debt problems?
A. Jobcentre Plus.
B. Debt Management Company.
C. Consumer Credit Counselling Service.
D. Credit reference agency.
10.
Which of the following is a long-term goal?
A. Saving for a holiday in 3 years time.
B. Saving for a 14 year old to go to university upon leaving school.
C. Saving for a deposit to buy a home within the next 5 years.
D. Saving in your 40’s for retirement at 65.
11.
Loan.
A
B
C
D
Minimum – Maximum
loan amount
£5,000 - £2,999
£1,000 - £4,999
£1,000 - £4,999
£1,000 - £9,999
Minimum – Maximum
Term
1 – 7 years
2 – 5 years
1 – 5 years
1 – 10 years
APR
9.90%
11.40%
12.90%
9.90%
Which of the following loans offer the best deal for borrowing £2,000?
A. Loan A.
B. Loan B.
C. Loan C.
D. Loan D.
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12.
Which of the following savings products are the most risky?
A. National Savings and Investments index-linked certificates.
B. Cash ISA.
C. Premium bonds.
D. 60-day notice account.
13.
ABC CARD
The only credit card you need
0% on Balance transfers
0% on Purchases
Subject to status.
Annual income £20,000 or more.
Balance transfers and purchases 0% for 12 months, then 14.9% APR
variable.
Balance transfer 2% handling fee.
Above is a fictitious TV commercial.
Decide if each of the following statements is TRUE or FALSE.
a. If you have a poor credit history you might not be eligible for this
credit card.
b. If you transfer an outstanding balance from another card to ABC
card, you pay no interest for charges for the first 12 months.
14.
Where would be the most suitable source of independent advice about
comparing personal loans?
A. FSA comparative tables.
B. High street bank website.
C. Price comparison website.
D. Advertisements in the newspapers.
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15.
Which of the following could you take a complaint about housing benefit to?
A. Financial Ombudsman Service.
B. Trading Standards Office.
C. Department for Communities and Local Government.
D. Social Security and Child Support Appeals Tribunal.
16.
When you first receive a new cash or debit card, what should you ideally
do?
A. Sign the Card.
B. Change the PIN.
C. Write the PIN down.
D. Nothing.
This is the end of the test.
If you have time, check the work you have done.
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