Banking and Investments Day 1 Assignment

What is the purpose of a savings account?

• To earn a high rate of return

• To meet short-term goals

• To invest for long-term goals

• To purchase stocks

What is the main advantage of an interest-bearing checking account?

• High liquidity

• High interest rates

• Low risk

• Guaranteed returns

What is the minimum purchase price for a savings bond?

• $10

• $25

• $100

• $1000

Which type of bond is backed by the U.S. government?

• Corporate bond

• James bond

• Treasury bond

• Preferred stock

What is the main advantage of investing in mutual funds?

• Low liquidity

• Low risk

• Diversification

• Guaranteed returns

What is the main risk of investing in collectibles?

• Lack of liquidity

• High interest rates

• High returns

• Regulated marketplace

What is the purpose of a retirement account?

• To meet short-term goals

• To invest in stocks

• To save for a down payment

• To have financial support in old age

What is the main advantage of a money market account?

• High interest rates

• Low risk

• Easy access to funds

• Not FDIC insured

What is the main advantage of diversification in investments?

• High liquidity

• Low risk

• High interest rates

• Guaranteed returns

What is the main advantage of owning common stock?

• Voting rights

• Guaranteed dividends

• Low risk

• Stable value