The idea is to give grown sims a bit of background, rather than them reaching adulthood with no life experience.
You have an idea of a character in mind, and answer/skip irrelevant questions how you believe the character would. By the end of the quiz you end up with some skills, job and savings that they might have acquired in their life up to that point based on your answers.
So say you wanted a sim that lived on Sulani, hates roughing it and is a well-off artist: Skip or answer in the negative any questions related to JA/OR or Off The Grid, answer ones from Sulani/IL positively, answer any money related questions in a way that would be profitable (selling artifacts etc) and any hobby/skill questions that mention painting should be anwered appropriately too. Any question you feel the sim wouldn't have a strong opinion about, skip.