Chapter 2 Understanding Your Paycheck
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Chapter Review
Build Your Vocabulary
As you progress through this course, develop a personal glossary of fi nancial
literacy terms and add it to your portfolio. This will help you build your fi nancial
literacy vocabulary. Write out a defi nition for each of the following terms, and
add it to your personal glossary.
deduction
progressive tax
withholding allowance
dependent
taxable income
Social Security tax
Medicare
FICA
fl at-rate tax
net pay
employee benefi ts
fringe benefi ts
pre-tax deduction
stipend
job expense
monetary value
raise
Teamwork
Ask a parent or grandparent what they remember about the fi rst time they
were ever paid for a job. What did they do for the money? How much were
they paid? Was it in cash or a paycheck? Did they save the money or spend it?
Compare what you learned in your interview with a partner. Which answers
were similar? Which were diff erent? What conclusions can you draw from the
two interviews about how diff erent people and diff erent generations deal with
money? Explain what you have learned to the class.
Review Your Math Skills
Practice and build on the math skills that you have learned.
1. Divide money amounts. Round answers to the nearest cent ($0.01).
Example: $32,000 ÷ 8 = $4,000
A. $16,500 ÷ 44 = B. $46,000 ÷ 16 =
C. $52,600 ÷ 26 = D. $34,500 ÷ 52 =
2. Round decimals to the nearest hundredth (0.01). Example: 22.875 ≈ 22.88
A. 13.698 ≈ B. 35,954.439 ≈
C. 163.966 ≈ D. 1,429.7799 ≈