Personal Finance 5 and 6

What is a certificate of debt issued by a corporation or government?

• bond

• dividend

• mutual fund

• stock

How long should the money in your emergency fund cover?

• one year

• eight to ten months

• six months

• three months

________ interest periods offer more flexibility for depositing and withdrawing money without loss of interest.

• Shorter

• Simple

• Longer

• Variable

Which of the following type of valuable goods can be considered an investment?

• gemstones

• collectibles

• precious metals

• All of the above.

A SMART goal should be _______.

• achievable

• mission-specific

• successful

• temporary

Which type of investment provides an individual with voting rights and receives dividends when declared by the company?

• common stock

• bond

• mutual fund

• preferred stock

Spreading risk by putting money in different types of investments is known as _____.

• diversification

• dollar-cost averaging

• variation

• risk tolerance

A payroll savings plan (PSP) is another application of which strategy?

• pay yourself first

• Rule of 72

• compounding interest

• time value of money

Which form states the total interest earned during a tax year?

• Form 1040

• Form W-4

• Form 1099-INT

• Form W-2

In which market do investors purchase securities from other investors rather than from the issuing company?

• secondary

• new-issues

• IPO

• primary