1. Explain different methods that citizen can use to reduce taxes legally 2. Analyze different types of taxes charged by the government to citizens 3. Differentiate between a fraud and scam. 4. Explain the concept of digital banking 5. Explain the contents of the following theories as applied in financial literacy; social th eory, decision theory and life cycle theory 6. Tim earn 30 ,000. He used 70:20:10 principle from 2000 to 2023 but decided to chang e to 50:30:20 from 2024 to 2027. Show money allocated to each part.

1. Citizens can legally reduce taxes through various methods such as contributing to retirement accounts, taking advantage of tax deductions and credits, and utilizing tax-deferred investments.<br /><br />2. The government charges different types of taxes on citizens, including income tax, property tax, sales tax, and excise tax.<br /><br />3. A fraud is a deceptive act or false representation with the intention to deceive or cheat, while a scam is a scheme or trick used to cheat or deceive someone.<br /><br />4. Digital banking refers to the use of electronic means, such as the internet and mobile devices, to conduct banking transactions and manage financial accounts.<br /><br />5. Social theory in financial literacy emphasizes the role of social interactions and relationships in shaping financial behaviors and decisions. Decision theory focuses on the process of making choices and the factors that influence those choices. Life cycle theory suggests that individuals plan their consumption and savings over their lifetime based on their expected income and expenses at different stages.<br /><br />6. Using the $70:20:10$ principle from 2000 to 2023, Tim would allocate $21,000 to needs, $6,000 to wants, and $3,000 to savings. From 2024 to 2027, using the $50:30:20$ principle, he would allocate $15,000 to needs, $10,000 to wants, and $5,000 to savings.