The P-Fin Index: I Don't Know (DNK)
Figure 3 shows the percentage of P-Fin Index questions answered with a “don’t know” (DNK) response in the aggregate and across functional areas. On average, individuals responded DNK to 24% of the P-Fin Index questions.
A DNK response for a question provides information beyond an incorrect answer. Previous research has found that a DNK response typically signals a more acute lack of knowledge and understanding relative to an incorrect answer. With the former, the knowledge and understanding that enable someone to even grasp the question tends to be missing. Therefore, focusing on the relative frequency of DNK responses and incorrect answers can provide further insights into financial literacy.
Earning, investing and go-to information sources are where individuals most frequently respond DNK to P-Fin Index questions—29%, on average (Figure 3). Beyond this, however, these are the only areas where DNK responses are more common (55% to 60%) than incorrect answers when a question is not answered correctly (Figure 4.) In contrast, while comprehending risk is the area where financial literacy is lowest (i.e., the average percentage of correct answers is lowest), DNK responses account for less than one-half (40%) of instances where a question is not answered correctly.