Chapter 4 Review Game

Front

Which of the following is considered the least risky investment? Sports betting, Stocks, Government bonds, Corporate bonds

Back

Government bonds

Front

What is fiat money?

Back

Money that has value because a government maintains it.

Front

Which of the following is a characteristic of a banknote? It is a digital currency, It is a receipt issued by a bank, It is a type of cryptocurrency, It is a form of barter

Back

It is a receipt issued by a bank

Front

Explain the concept of a bank holding reserves and its importance in the banking system.

Back

It ensures banks can meet withdrawal demands

Front

Compare the liability of a sole proprietorship with that of a corporation.

Back

Sole proprietorships have unlimited liability, corporations have limited liability.

Front

How does a mutual fund work?

Back

It pools money from many investors to purchase stocks and bonds

Front

What is the role of the Federal Reserve in the banking system?

Back

It regulates the money supply and banking

Front

What is a Certificate of Deposit (CD)?

Back

A timed-savings account with a fixed interest rate

Front

Using the Rule of 72, estimate how many years it will take for an investment to double at an annual interest rate of 6%.

Back

12 years

Front

What is the primary difference between stocks and bonds?

Back

Stocks represent ownership, while bonds represent debt from a loan.