SGO (Quaterly) Review

Which statement is the most correct description of liquidity?

• how quickly and easily an asset can be converted into cash

• the amount of savings available

• a measurement of how much a person or household owns once all debts have been paid

• the amount of money needed to pay for the necessities and comforts currently enjoyed

Which of the following is a feature of a certificate of deposit (CD)?

• Funds deposited in a CD are held for a certain length of time

• Funds deposited in a CD all have the same interest rate

• Funds deposited in a CD are very liquid

• Funds deposited in a CD can be accessed via check or debit card

The most common relationship between risk and return in investing can be stated as:

• higher risk indicates lower return

• higher risk indicates higher return

• lower risk indicates higher return

• No relationship exists between risk and return

A diversified portfolio is desirable because it:

• increases the risk/return ratio

• limits investors choices to only one or two investment tools

• indicates an investor is a good predictor of the return that an investment will have

• decreases risk by investing money in a variety of investment tools

Who would you contact to purchase or sell stocks?

• A brokerage firm

• The New York Stock Exchange

• A real estate agent

• You should complete this transaction on your own

A dividend can best be described as:

• A share of ownership in a company

• A percentage of the profits distributed to stockholders

• A gift from the company to stockholders

• Monthly cost to own the stock

In relation to the other options, how liquid is a savings account?

• More liquid than cash

• The most liquid account

• More liquid than a Certificate of Deposit

• More liquid than a checking account

A tiered interest can best be described as:

• What happens when The Fed changes the interest rate

• The different rates in various types of accounts

• The more money in an account, the higher the interest rate will be

• Interest rates declining over time

When is a Price per Earnings ratio helpful?

• To determine the liquidity of a stock

• To compare similar stocks

• To determine the volatility of a stock

• To evaluate the change in price from the prior day

The most likely reason there is a statue of a bull on Wall Street in New York City is:

• The bull represents America's economic system

• The bull represents what happened to the stock market during the Great Depression

• The bull represents a positive stock market

• The bull looks really cool