Lesson 7 & 9

When determining your investment rationale (or investment goal) you have broadly two potential strategies to follow:

• Loss or Gain

• Cash or Non-cash

• Investing for Income or Investing for Growth

• None of the above

When it comes to leaving your money in cash:

• Inflation is a good thing as it will cause your money to grow

• Inflation is a bad thing as it negatively impacts the value of your savings in the longer term

• Inflation doesn’t really matter.

• Inflation is a good thing as it means other investments are performing badly

In terms of the risk-return relationship:

• By moving your money from cash into a corporate bond, you are increasing your risk but increasing your opportunity for a better return.

• By moving your money from cash into equities you are increasing your risk but with no chance of a better return

• By moving your money from equities into government bonds you have the same level of risk but should expect a lower return.

• By moving you from equities into cash you are increasing your risk

National Savings & Investments are generally:

• High risk/High Return

• Low Risk/High Return

• Low Risk/Low Return

• High Risk/Low Return

Banks are generally

• Mutual organisations which belongs to its members

• Listed companies belonging to its shareholders

• Private companies

• None of the above

Cash ISAs:

• Are tax free investments

• Generally allow instant access to cash invested

• Are open to UK residents aged 18 and over

• All of the above

Which of the following are all real assets:

• Wine, Gold, Company Shares

• Holiday home, ISA, Jewellery

• Gold, Jewellery, main residence

• Premium Bond, Wine, Holiday home

The following is not a feature of most current accounts:

• Cheque book

• Access to instant credit of up to £10,000

• Overdraft facilities

• Access to standing orders/direct debit facilities

In the context of compound interest CAR stands for:

• Compound Annual Rate

• Compound Average Rate

• Certified Annual Rate

• Compound Annual Return

Which of the following can be said of investing in property as a real asset:

• It is a very liquid asset class

• It can generate a relatively stable income

• It has no ongoing maintenance costs

• It will not generate a negative return