Fundamentals of Investing

Stock trading is about buying and selling stocks for short-term profit, with a focus on share prices. Investing is about buying stocks for long-term gains.

• True

• False

A person should start investing before having an emergency fund.

• True

• False

All Investments Have Some Risk

• True

• False

Higher risk can equal higher (a)  

Profit or income generated by saving and investing.

• stock

• return

• loss

• none of the above

Investments are Important to Building Net Worth

• True

• False

Money invested is usually used to pay for Short-term goals.

• True

• False

Mandy saved $2,200 in a money market deposit account. After one year, she has a return of $110. What is Mandy’s rate of return?

• $110

• $2200

• $2310

• 5%

Rise in the general level of prices

• Cost of living

• Inflammation

• Deflation

• Inflation

A form of lending to a company or the government.

• Stock

• Ownership

• Bond

• None of the above