Savings and Investing

A bond may finance the needs of all of the following except

• Local governments
• The federal government
• Corporations
• Private companies

Which is the least risky?

• Stock
• CD
• Savings account
• Mutual fund

Don't put all your eggs in one basket best refers to which of the following pieces of advice

• Diversify your stock portfolio in order to reduce risk
• Invest in a single stock for the largest gain
• Take out as many loans as you can
• Don't hesitate when buying stocks

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

Why is compound interest more beneficial than simple interest? (hint: choose 2 correct answers)

• Your money grows faster when it is compounded

• You earn interest on your interest

• Fees for compound interest are greater than simple interest

• Compound interest is hard to calculate, so fewer use it

Which would be considered the highest risk investment type?

• Stock

• Mutual Fund

• Bond

• Money Market Account

How can you make money on stocks? (hint: choose 2 correct answers)

• A capital gain

• Interest

• Dividends

• Holding the stock at least 3 years

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