Unit 5 - Investing and Retirement

Savings accounts and money-market accounts are most appropriate for:

• Emergency funds and short-term goals

• Savings accounts and money-market accounts should be avoided since they carry high risk

Which statement is false about liquidity?

• The more liquid an investment, the less return

• The less liquid the investment, the less return

Company Xʹs board of directors has decided to issue a portion of its earnings to its shareholders. If you own stock in Company X, you can expect to receive a(n):

• Yield

• Dividend

The benefit of diversification in your investments is:

• Reduced risk

• Reduced tax liability

The persistent increase in the cost of goods and services or the persistent decline in the purchasing power of money

• Deflation
• Interest
• Inflation
• Recession

Savings accounts and money market accounts are most appropriate for:

• long term investments like retirement

• earnings high rate of return

• emergency funds and short term goals

• savings accounts and money market accounts should be avoided since they carry high risk

A retirement plan found in nonprofit organizations such as churches, hospitals,and schools.

• GIC
• 457
• 401K
• 403b

Employee benefit packages:

• should not be a consideration 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 and salaries

you can start investing with a small amount of money.

• True
• False

good investment portfolios are extremely complex.

• true
• false