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Which Definition of Financial Literacy is the Most Accurate

Which Definition of Financial Literacy is the Most Accurate

 

The capacity to locate, assess, use, distribute, and produce financial content.
The services or products that a bank offers.
The capacity to apply knowledge and abilities to efficiently manage financial resources.
The effective and efficient handling of finances.

 

Answer: 3. The capacity to apply knowledge and abilities to efficiently manage financial resources.

The capacity to use information and abilities to handle money wisely is known as financial literacy. Effective money management requires understanding of various financial issues, such as investments, budgeting, savings, insurance, etc. As a result, people are more equipped to manage their money wisely in their daily lives. A country with a vast number of financial literates tends to have fewer people in extreme poverty.

 

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