PBMF Ch 19-Checking/Savings

Investing means using your savings to earn more money

• True

• False

If a stock increases in value and is then sold for more than its original cost, a capital gain results.

• True

• False

Usually, higher risk investments pay higher yields than lower risk investments.

• True

• False

Land and anything attached to it is called real estate.

• True

• False

The money you receive for letting others use your money is called ________________

• security

• interest

• collateral

• premiums

Money market accounts

• require minimum balances and pay higher interest rate

• generally require long-term deposits.

• usually pay much less than a regular savings account, but are far more secure.

• rarely have a large minimum balance requirement.

The storage of money for future use is called

• saving

• compound

• mutual

• yield

In a(n) ______________________ fund, money from many investors is used to invest in a variety of companies, allowing investors to spread out their risk among many investors.

• saving

• compound

• mutual

• yield

The ease with which an investment can be changed into cash without loosing its value is called _________________

• liquidity

• dividends

• commission

• value

Defined contribution retirement account provided by your employer that is taken out of your paycheck before you pay any taxes on this income.

• IRA

• Roth IRA

• 401K

• Pension