Personal Finance Ch 8

Which Statement is true about liquidity?

• The more liquid the investment, the more return
• The less liquid the investment, the less return
• The more liquid the investment, the less return
• Both A and B

The benefit of diversification in your investments is:

• Reduced Risk
• Increased Return
• Reduced Tax
• Increased Risk

Long Term Investments, properly diversified, include the following mutual funds:

• Growth, International, balanced, bond
• Growth, Growth & Income, Aggressive Growth, and International
• International, Growth, Aggressive Growth, and Bond
• Growth, Growth & Income, Aggressive Growth, and Bond

A reason that people need to save and invest is:

• Enable their money to make money
• Increase the money supply
• Be able to get anything they want
• have an opportunity to talk with financial service providers

Company X's board of directors has decided to issue a portion of its earnings to its shareholders.  They would receive a ___________?

• Investment
• Divedend
• Buy-out
• Yield

A young investor willing to take moderate risk for above-average growth would be most interested in:

• Single Stocks
• Bonds
• Mutual Funds
• Real estate

Employee Benefit Packages:

• Should not be considered when looking for a job
• Never include retirement plans
• Are the same regardless of the company you work for
• Are non-wage compensations provided to employees in addition to their normal wages or salaries

Money Markets are great for your emergency fund due to their liquidity and stability.

• True
• False

Which investment has the most risk?

• CD's
• Bonds
• Mutual funds
• Stocks

You should start investing as soon as your college is paid for

• True
• False