Unit Nine: Financial Planning Review

Front

Of the many ways you can invest for your future, there is one that allows you to not only plan for a retirement savings, but also provide supplemental coverage to your insurance. Which of the following achieves this? Health Savings Accounts, Roth IRA, 401 (k), COBRA

Back

401 (k)

Front

When companies like Exxon, Tesla, and General Electric make a profit and report their earnings, what do investors like Jack receive?

Back

Dividends

Front

Which best explains the difference between common stock and preferred stock?

Back

Common stocks do not guarantee dividend payouts while preferred are guaranteed a percentage.

Front

When these companies make a profit and report their earnings, Jack and other investors will receive...

Back

Dividends

Front

Of the retirement savings options below, which one will guarantee that you do not pay taxes on your money when you withdraw it at retirement? 401(k), Roth IRA, Traditional IRA, Defined Benefits Plan

Back

Roth IRA

Front

Which best explains the relationship between risk and reward in regards to investments and investment strategies? Options: The lower the risk of the investment the higher the reward. There is no known relationship between risk and reward. The lower the risk of the investment the lower the reward. The higher the risk of the investment the lower the reward.

Back

The lower the risk of the investment the lower the reward.

Front

Based on the information provided, which statement about Kevin's account is true? Options: Kevin has established a savings account that only pays interest upon withdrawal. Kevin has opened a savings account that pays interest quarterly. Kevin has established a savings account with simple interest. Kevin has established a savings account with compounding interest.

Back

Kevin has established a savings account with compounding interest.

Front

If you were looking to invest your money into a single investment type that would offer, potentially the greatest return, regardless of the risk involved which would be your best choice? Options: Savings Accounts, Bonds, Stocks, Money Market Account

Back

Stocks

Front

How does investing in the stock market differ from putting money in a savings account at a bank?

Back

Investing allows you to accumulate wealth for retirement while saving is best for short-term purchases or emergencies.

Front

Why is compound interest more advantageous than simple interest?

Back

Compound interest allows you to earn interest on the amount you have saved, and on the interest you've already earned.