Investing Knowledge Assessment

Front

What do stocks represent?

Back

Partial ownership in a company

Front

What is the primary purpose of issuing bonds?

Back

To raise capital for companies or governments

Front

Which of the following is considered a cash equivalent? Real estate, Stocks, Savings accounts, Corporate bonds

Back

Savings accounts

Front

What does the term "risk vs. reward" refer to in investing?

Back

The potential for higher profits with higher risk

Front

What is default risk?

Back

The risk that a borrower will not be able to repay their debt.

Front

What is the main benefit of diversification in a portfolio?

Back

It reduces the impact of poor performance in any single investment.

Front

What information can you find in stock tables?

Back

Stock performance metrics such as 52-week high and low

Front

How is the Rate of Return (ROR) calculated?

Back

ROR = (Current Value - Initial Value) / Initial Value * 100%

Front

What do brokerage fees impact?

Back

The overall profit from selling stocks

Front

In the event of bankruptcy, which debts are repaid first? Options: Unsecured debts, Secured debts, Shareholder dividends, Future loans

Back

Secured debts