Investing Quiz

Which of the following is not an investing tool?

• stock

• mutual fund

• checking account

• bonds

Municipal bonds are issued by what?

• state and local governments

• the federal government

• corporations

• nonprofit organizations

What is considered a low-risk investment?

• Stocks

• certificates of deposit

• mutual funds

• junk certificates

Many companies depend on the sale of shares of stock when they what?

• want to downsize

• want to expand

• are being audited

• hire a new president or executive on the board

A mutual fund is 

• An investment in a diversified group of stocks
• The money left over when reinvested into the company
• An account that guarantees a fixed rate of return
• Exclusively for retirement accounts

When you purchase a _______, you become part owner of a company.

• bond

• dividend

• stock

• portfolio

How does investing in the stock market differ from putting money in a savings account at a bank?

• Savings has a higher return

• Stocks are safer

• Savings is more liquid (easily accessible)

• You cannot lose money when 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

Which would be considered the highest risk investment type?

• Stock

• Mutual Fund

• Bond

• Money Market Account

Diversification is important in investing because…

• It helps you to balance your risk across different types of investments.

• It increases your overall risk, which guarantees that you will make more money.

• It ensures that you only make low-risk investments.

• It helps you gain the highest rate of return despite any risks.