Font size
WorksheetsFinal Review
Total questions: 50
Worksheet time: 27mins
Bonds are a form of investment that you
Own
Lend
A pool of money collected from many investors, and used to buy stocks, bonds, and other securities.
stock
mutual fund
bond
goals
Much less risky
saving
investing
Deposit is usually not insured
savings
investing
Provides fixed interest payments for a set period of time
money
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
Bonds are a safer investment than stocks
True
False
A sum of money paid to shareholders (stockowners) of a corporation out of its earnings.
index
dividend
profit
bitcoin
The possibility of losing all or part of your investment is known as
asset allocation
compounding
return
risk
Generally, how is risk related to return?
the lower the risk, the greater the possibility of a high return
the greater the risk, the greater the possibility of a high return
the greater the risk, the greater the possibility of a low return
risk and return have no relationship
A single share of ownership of a company is called a:
Bond
Mutual Fund
Annuity
Stock
Stocks are low risk investments options.
True
False
Why do companies issue stocks?
To create and investment opportunity into other businesses.
To increase employee cooperation
To be traded individually
To raise money for economic investment
How can you make money on stocks? (hint: choose 2 correct answers)
A capital gain (buy low sell high)
Interest
Dividends
Holding the stock at least 3 years
Stocks are a form of
Owning
Lending
Currencies are traded between countries on the Foreign Exchange, or FX market
True
False
The value of every country currency stays the same every day.
True
False
The price to buy one US dollar with British Pounds, and visa-versa, is called
The NASDAQ composite
Foreign Exchange rate
S & P 500
Dow Jones Industrial Average
Foreign Exchange rate is determined
by?
supply and demand
The British Empire
The United States
The Nigerian Empire
________________ means making money based on buildings or
properties.
Real Estate investing
Stock investing
Bond investing
Mutual Fund investing
Which is NOT one of the four main ways to be a real estate investor
Speculator
Landlord
Renter
REIT Investor
Beyond regular homeowners, “house flipping” is also speculation (where a person buys a run-down house for cheap, fixes it up, and sells it for a profit).
True
False
Someone who owns property and rents it out to someone else is called
house flipper
property developer
stock broker
landlord
In the U.S. there are three major stock exchanges. Which is NOT a US stock exchanges?
The Detroit Stock Exchange (DETEX)
the American Stock Exchange (AMEX)
the New York Stock Exchange (NYSE)
the NASDAQ
Stock Exchanges provide a place where
stock brokers meet for lunch
stocks are stored
buyers and sellers come together to buy and sell shares
Bond market
In a Certificates of Deposit (CDs) you agree to (PICK TWO ANSWERS)
have access to your money whenever you need it
deposit a specific amount of money for a fixed period of time
have limited opportunities to access your funds
Generally you will find that the longer the term of the CD, the the LESS interest rate you earn.
True
False
When you buy a CD you are NOT locked into that interest rate for the life of the CD. If you take out your money before the full term, the bank will NOT charge you a penalty
False
True
False
Money Market Accounts (MMAs) are designed to be a combination of the features of a classic savings account and a CD. WHICH of the following is NOT typical feature of (MMAs)
A minimum balance that must be maintained (e.g., $2,500)
Higher interest rate than classic savings accounts
No minimum balance that must be maintained
Limited withdrawals each month (typically up to six transactions per month)
Bank Money Market Accounts are another form of savings account and carry the federal insurance, currently up to $250,000 per depositor, which all other deposit accounts enjoy.
True
False
Bonds differ from stocks in that they have a stated earnings rate and will provide a regular cash flow, in the form of the coupon payments to the bondholders.
True
False
U.S. Treasuries bonds are issued by city government?
True
False
Typically corporate bonds are more secure than
corporate stocks.
True
False
Gold and Other Precious Metals are different from other commodities because
they are worthless and difficult to sell
they are only found in the United States
they are only found in Africa
they have value in and of themselves – people want to own them.
An example of a precious medal is
Gold
Silver
Copper
Precious metals is determined by the same factors that impact a stock’s price – how much is someone else willing to pay for it?
True
False
Due to pure supply and demand the more people want to buy, own, and keep precious medals for themselves, the less is available for purchase. This make the price of precious medals
go down
go up
stays the same
What is a difference between a Checking account and a Savings account?
Savings accounts are the type of bank account you would use for regular purchases.
banks usually offer interest rates to a savings account because you usually keep more cash sitting for longer periods of time
Checking accounts are the oldest type of bank account
Risk vs Reward means that the
highest risk investment usually gives you the greatest reward
the lowest risk investment usually gives you the greatest reward
the highest risk investment usually gives you the lowest reward
Savings accounts is consider
A high risk investment
A low risk investment
Neither a low risk or a high risk investment
Liquidity means
how easily you can get cash for an investment
w fast you can convert your investment to cash
how long your money will earn interest in a bank
The principle of liquidity means (pick two answers)
The more “Liquid” the asset, the lower reward
The more liquid usually means higher reward
Less Liquid usually means greater rewards
Commodities are raw materials that form the basis for the economy
True
False
What is not an example of commodities
cocoa
wheat
crude oil
Car
Prices of commodities fluctuate not based on the long-term profitability of a company’s business plan, but based on the current surplus (or shortage) of that commodity.
True
False
Commodities investor do not have to pay attention to the news and the global economic trends than the other investment types we have covered so far.
True
False
Unlike Mutual Funds, the ETF prices stays the same throughout the day as they are bought and sold based on the performance of the stocks that the ETF is holding.
True
False
Some ETFs are tied to an index, which make them “exchange-traded index funds”. For example, one of the most popular ETFs tries to mirror the composition of the Standard & Poor (S&P) 500, using their performance as an index (see the S&P 500 ETF, ticker symbol = SPY) and another tries to mirror the Dow Jones Industrial Average (ticker symbol = DIA).
True
False
ETFs are simply a portfolio of stocks or bonds or other
investments that trade on (3 ANWERS)
Stock Exchange
NASDAQ
NYSE
CNN
Since one of the primary rules of investment is to diversify (spreading the risk) portfolios, a mutual fund AND ETFs can be a simple and successful way to accomplish this goal.
TRUE
FALSE
