WorksheetsMoney Matters 7- Savings, Investing and the Stock Market
Total questions: 20
Worksheet time: 20mins
A pool of money collected from many investors, and used to buy stocks, bonds, and other securities.
stock
mutual fund
bond
goals
The amount of money you earn compared to the amount of money you invest
Equity investment
term
fixed income statements
return on investment (ROI)
A type of time account
CD
stock
bond
mutual fund
All are benefits of saving, except
safe, reliable, convenient
earns a higher return of interest
earns a small amount of interest
insured by the FDIC
Saving and investing provide opportunities to increase your wealth, leading to financial security
True
False
Bonds are a safer investment than stocks
True
False
A key difference between saving and investing is
Saving is for everyone, investing is for the wealthy
Your money is insured when investing, it is not in savings
Investing has a guaranteed return, savings does not
Saving is for emergencies & goals, investing is for long-term wealth
Why is compound interest more beneficial than simple interest? (hint: choose 2 correct answers)
Your money grows faster when it is compounded
You earn interest on your interest
Fees for compound interest are greater than simple interest
Compound interest is hard to calculate, so fewer use it
The relationship between risk and return can be stated as
Higher risk indicates higher return
Higher risk indicates lower return
Lower risk indicates higher return
No relationship exists between risk and return
How can you make money on stocks? (hint: choose 2 correct answers)
A capital gain
Interest
Dividends
Holding the stock at least 3 years
If interest rates rise, what will typically happen to bond prices?
Rise
Fall
Stay the same
Which is true about Initial Public Offerings (IPOs)? (hint: choose 3 correct answers)
IPOs occur when a private company becomes publicly traded
All companies file an IPO
The value of an IPO can be difficult to measure
When an IPO occurs, a company raises money to grow the business
A diversified portfolio is desirable because
It limits investment choice
It's a good predictor on rate of return
It increases risk and return
It decreases risk
Why is it important to start investing as soon as possible?
You take less risk when you are young, so money will be safe
You have more time for your money to compound
Investing is an easy way to make quick money
Fees on investments are cheaper when you are younger
True or False: Investing in a diversified portfolio of stocks guarantees you will not lose money.
True
False
A basic type of bank account that allows you to put aside money for future use and earn interest.
Certificate of deposit
Money market account
Savings account
Stocks
A share of a corporation sold to the public
Bond
Stock
Mutual fund
Investment
An IOU issued by a company, municipality (city), or the federal government in exchange for a loan from an investor that will be repaid with a set rate of return.
Bond
Certificate of deposit
401k
Stock
The individual units of ownership in a stock are called.....
Slices
Shares
Segments
Sections
