Bus. Fin. Test Module 4 - Investing

A key difference between saving and investing is

• Saving is for everyone, investing is for the wealthy

• Your money is insured when investing, it is not in savings

• Investing has a guaranteed return, savings does not

• Saving is for emergencies & goals, investing is for long-term wealth

Tags

CCSS.L.11-12.4C

CCSS.L.6.4C

CCSS.L.7.4C

CCSS.L.8.4C

CCSS.L.9-10.4C

Which would be considered the highest risk investment type?

• Stock

• Mutual Fund

• Bond

• Money Market Account

The relationship between risk and return can be stated as

• Higher risk indicates higher return

• Higher risk indicates lower return

• Lower risk indicates higher return

• No relationship exists between risk and return

Which is NOT a stock market index?

• New York Stock Exchange

• Dow Jones Industrial Average

• S&P 500

• Nasdaq

If interest rates rise, what will typically happen to bond prices?

• Rise

• Fall

• Stay the same

The face value of a bond is called

• Principal

• Coupon

• Par Value

• Maturity Date

Andy earned $300 on a $1000 investment. What is his current ROI (return on investment)?

• 2%

• 3%

• 30%

• 70%

A diversified portfolio is desirable because

• It limits investment choice

• It's a good predictor on rate of return

• It increases risk and return

• It decreases risk

Putting regular amounts of money into an investment account at specific time intervals is

• Compound interest

• Diversification

• Dollar cost averaging

• Inflation

Tags

CCSS.6.RP.A.3B

Your money remains tax-deferred in this account until you withdraw (taxed as income)

• Roth IRA

• Traditional IRA