Answers 26-27 Ignite Financial Literacy Personal Finance - EL3403 Careers, Salaries, and Lifetime IncomeQuestion 11

11

QuizMultiple Choice

Careers, Salaries, and Lifetime Income

Question 11 • 26-27 Ignite Financial Literacy Personal Finance - EL3403

How is gross income different from net income?

Answer

A

Gross income and net income include all the money you have made.

B

Gross income and net income are the same, except net income is only reported on tax forms.

C

Gross income is how much money you want to make, while net income is your taxable income.

D

Gross income is how much money you make, while net income is your gross income minus deductions.

Explanation

Gross income is the total amount you earn before deductions. Net income is what remains after deductions, such as taxes or other withholdings, are subtracted from gross income. Therefore, choice D correctly distinguishes the two.

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