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WorksheetsCFE Quarter 2 Review
Total questions: 118
Worksheet time: 2hrs 16mins
It is meant for short-term goals
Saving
Investing
It involves assets like stocks and bonds
Saving
Investing
It harnesses compound interest and higher average returns to grow your wealth faster
Saving
Investing
It involves very little risk
Saving
Investing
Your account balance will be impacted by the market
Saving
Investing
When price levels increase, purchasing power (a) .
In addition to the price of goods and services, what else is impacted by inflation?
(Select all that apply.)
Wages
Savings
Debts
Interest
If you put money in a savings account earning a rate of return of 1% and inflation is currently at a rate of 2%, your money will be worth ____.
more in the future.
less in the future.
exactly the same.
Every time Pinocchio lies, his nose doubles in size. His nose is 1.5 inches long before he has told any lies.
Calculate how many inches Pinocchio’s nose will be after 4 lies.
(a)
You make a $10,000 investment that has historically doubled every 7 years.
Calculate the value of your investments after 12 years.
(Round your answer to the nearest hundredth. Include punctuation as needed.)
(a)
Sari makes an investment with the goal of having $30,000 after 40 years. If the growth factor is 1.08, how much money will she need to invest to reach her goal?
(Round to the nearest whole dollar. Add punctuation where needed.)
(a)
Charlotte has $15,000 to invest and would like this investment to grow to $28,000. If the growth factor is 1.06, how many years will it take to reach her goal? Use guess and check to find an approximate answer.
(Answer should be a whole number.)
(a)
All of the following are reasons to invest, EXCEPT…
To minimize the impact on inflation, which causes you to lose purchasing power
To earn a consistent rate of return with lower risk than typical savings accounts
To build wealth by reinvesting your returns and allowing them to compound
To earn higher average rates of return than you would in a typical savings account
Sandra has $500 in a savings account that earns 1% annual interest. She leaves that money in the account for 5 years. If inflation averaged 2% per year, what happened to the purchasing power of her savings?
It increased
It decreased
It stayed the same
It matched inflation
What is the benefit of starting to invest early, even with a small amount?
Your investments are likely to grow more since compounding means returns get larger over time
You are guaranteed higher returns since compounding reduces the risks of investing
You can use your investments to meet short-term financial goals since you don’t need to hold them as long
You can take advantage of brokerage discounts for long-term investors
You put $100 in a savings account that earns 1% interest every year.
Identify if it is a linear or exponential function and if it shows growth or decay and by how much.
Exponential
Growth
1%/year
Exponential
Decay
1%/year
Linear
Growth
1%/year
Linear
Decay
1%/year
You put $10 in a savings account and deposit an additional $10 every month.
Identify if it is a linear or exponential function and if it shows growth or decay and by how much.
Exponential
Growth
$10/month
Exponential
Decay
$10/month
Linear
Growth
$10/month
Linear
Decay
$10/month
You put $75 in a checking account with no annual interest.
Identify if it is a linear or exponential function and if it shows growth or decay and by how much.
Exponential
Growth
$0
Exponential
Decay
$0
Linear
Growth
$0
Linear
Decay
$0
You have $1500 in savings. Every year, inflation causes your money to decrease by 2% in purchasing power.
Identify if it is a linear or exponential function and if it shows growth or decay and by how much.
Exponential
Growth
2%
Exponential
Decay
2%
Linear
Growth
2%
Linear
Decay
2%
The table below represents the growth of an investment account over 3 decades. What is the growth factor of this function?
(a)
The table below represents the growth of an investment account over 4 years. What is the growth factor of this function?
(a)
Solve for the variable. Round to the nearest hundredth, if necessary. Make sure to add commas and decimals when needed.
y = 125(6)4
(a)
Solve for the variable. Round to the nearest hundredth, if necessary. Make sure to add commas and decimals when needed.
y = 12,250(0.6)11
(a)
Solve for the variable. Round to the nearest hundredth, if necessary. Make sure to add commas and decimals when needed.
y = 250,000(0.93)2
(a)
Solve for the variable. Round to the nearest hundredth, if necessary. Make sure to add commas and decimals when needed.
1,290 = a(2)3
(a)
Which of these statements about stocks is FALSE?
Owning a stock means you own part of a company
Companies sell stocks to raise money for their business
Stocks are guaranteed to increase in value over time
Stock prices can be affected by things like the news and false rumors
Davis is interested in starting to invest and asks their family and friends for tips. Who is providing sound advice on how to invest?
Mom: “You’ve got to time the market. That’s how most people make money investing.”
Franklin: “Trends are hard to predict, and that makes timing the market difficult.”
Grandpa Joe: “You can look at a past trend in a stock and know how it’ll behave in the future.”
Jane: “Always follow market trends - buy in a bull market and sell in a bear market.”
If the price of the share grows as the company grows, how does buying shares in a company benefit an investor?
An investor will be able to decide what the company sells and set the price
An investor will be able to sell these shares for a higher price and make a profit
An investor will be able to enjoy free services from the company they bought shares from
An investor will be able to put the company on their resume
What is the difference between a bear and a bull market?
A BULL market is when the stock market is rising and the economy is booming, while a BEAR market describes a declining market and a receding economy.
A BULL market is when there is a decline in the stock market and the economy is receding, while a BEAR market describes a rising market and a booming economy.
Which adjective would best describe a BEARish investor attitude?
Optimistic/Positive
Pessimistic/Negative
True or False: It is easy to predict trends in the stock market.
True
False
What were the overall returns during the bull market from 1970 to 1973?
(a)
If you invested $100 at the beginning of that market, how much would you have had in 1973?
(a)
Imagine you invested $1000 at the beginning of the bull market in 1988 and got out right before the dot-com bubble burst in 2000 causing a recession. How much would your portfolio have been worth at that time?
(a)
Tori bought one share of Macy's stock on Nov 1, 2016 for $33.38. Four years later, she sold it and the closing price for that day was $5.09.
What is her rate of return?
(a)
Chadwick also bought one share of Macy's stock for $33.38 on Nov 1, 2016, but he sold it three years later for $13.54.
How much money did he gain/lose with this one share?
(a)
Tori bought one share of Chipotle stock on Nov 1, 2016 for $396.33. Then, four years later, she sold it at the closing price of $778.38.
How much money did she gain/lose with this stock?
(a)
Chadwick bought 50 shares of Chipotle stock on Nov 1, 2016 for $396.33 per share. He sold the shares four years later for $778.38 per share.
What did Chadwick pay for all of the shares in 2016?
(a)
Chadwick bought 50 shares of Chipotle stock on Nov 1, 2016 for $396.33 per share. He sold the shares four years later for $778.38 per share.
What was the value of all of his shares four years later?
(a)
Chadwick bought 50 shares of Chipotle stock on Nov 1, 2016 for $396.33 per share. He sold the shares four years later for $778.38 per share.
How much money did he gain/lose with this stock?
(a)
Sierra walks into a store and spends $12. If there is a 7% sales tax, how much did Sierra spend?
(a)
Ang finds a great sale on a new pair of headphones. The original cost was $89 but the item is 25% off. What is Ang's total bill?
(a)
Write an equation that represents the following situation
•Starting value = 125
•Rate = 6% growth per year
•Years = 10 years
Use the ^ symbol to represent an exponent.
(a)
Write an equation that represents the following situation
•Starting value = 200
•Rate = 2.5% decay per year
•Years = 5 years
Use the ^ symbol to represent an exponent.
(a)
Kendra’s aunt sent her $50 for her birthday 10 years ago. At the time, Kendra wasn’t sure what she wanted to do with the money so she put it in a piggy bank and forgot about it. She just found this $50 in the piggy bank when she was cleaning her room. Over the past ten years, yearly inflation has averaged 2.46%. How much is Kendra’s birthday money worth now?
(a)
If Kendra hadn’t found the money for 20 years, and the average inflation rate was 2.46%, what would be the purchasing power of the $50?
(a)
Sam is working his dream job as a graphic designer. Sam’s starting salary was $55,000. He is great at his job but has not received a raise since he started working 5 years ago. What is the purchasing power of Sam’s $55,000 salary now, compared to 5 years ago, if the average inflation rate over the past 5 years was about 3.5%?
(a)
You make an investment where the balance over time can be modeled by the equation y = 32000(1.035)x, where x represents the number of years since the investment started and y represents your total balance after x years.
What is the rate of growth of your investment?
(a)
y = 100(0.96)x is an equation that can be used to represent the purchasing power of $100 after x years of inflation. What is the rate of inflation used to make this calculation?
(a)
What are the three common assets considered in asset allocation?
Stocks, bonds, and bond funds
Stocks, bond funds, and mutual funds
Stocks, real estate, and cryptocurrency
Stocks, bonds, and cash
The annual interest rate of a bond is called the ______ rate.
Face value
Coupon
Maturity
Discount
All of these are ways diversification helps your investments EXCEPT...?
Diversification minimizes the risk of one investment failing and ruining your whole portfolio
Diversification ensures that if some investments are going down, others will be going up
Diversification smooths out the volatility of stocks in an investing portfolio
Diversification helps you adjust your investments to fit your changing life needs
Select the best definition of a bond.
A bond is ownership in a company.
A bond is a sum of money paid regularly to its shareholders by a company.
A bond is an FDIC insured investment account.
A bond is a loan to the government or a company that pays investors a fixed rate of return over a specified period of time.
What does the term coupon mean (when related to bonds)?
The timeframe of the bond
The annual interest rate paid on a bond
The face value of the bond
The discounted rate of the bond when purchased
Which is the highest bond rating?
AAA
BBB
CCC
DDD
Why would someone invest in a bond with a low rating?
Lower rated bonds typically have a higher coupon
Lower rated bonds typically have a lower coupon
Lower rated bonds are typically less expensive
Lower rated bonds are typically more expensive
What is a bond fund?
A bond issued by a corporation to raise funds for a variety of reasons
A bond that does not pay interest but is sold at a discount
A mutual fund that invests in a variety of bonds
A mutual fund that mimics a particular market index
Bonds have less risk than stocks, but more risk than a savings account.
True
False
Imagine you have a bond with ten years left until maturity, a face value of $1,000 and a 4% coupon rate. Interest rates recently rose to 6% and you want to figure out how it might impact the price of your bond. We will do some simple calculations, ignoring inflation, to see what might change.
How much would you be paid total in interest over the next ten years of holding the bond?
(a)
Imagine you have a bond with ten years left until maturity, a face value of $1,000 and a 4% coupon rate. Interest rates recently rose to 6% and you want to figure out how it might impact the price of your bond. We will do some simple calculations, ignoring inflation, to see what might change.
If you bought a new $1000, 10-year bond at today’s higher 6% coupon rate, how much would that bond be worth in total, including both principal at maturity and interest along the way?
(a)
What does the following describe:
Bonds with lower credit ratings and a greater chance of default, often issued by startups or struggling businesses
HG Bnd: High grade bonds
Lg Cap: Large cap stocks
Int’l Stk: International developed stocks
HY Bnd: High yield bonds
What does the following describe:
Largest US companies, which have a market cap over $10 billion
Lg Cap: Large cap stocks
Sm Cap: Small cap stocks
HG Bnd: High grade bonds
Int’l Stk: International developed stocks
What does the following describe:
Bonds with high credit ratings and lower risks of default, usually issued by stable companies
HG Bnd: High grade bonds
HY Bnd: High yield bonds
AA: Asset Allocation Portfolio
Lg Cap: Large cap stocks
Based on the equations for each line, determine how many solutions the system would have.
y=2x+3
y=-4x+3
Infinite Number of Solutions
No Solution
One Solution
Based on the equations for each line, determine how many solutions the system would have.
y=5x+3
y=5x-2
Infinite Number of Solutions
No Solution
One Solution
Based on the equations for each line, determine how many solutions the system would have.
y=-3x+2
y=-3x+2
Infinite Number of Solutions
No Solution
One Solution
Solve the system of inequalities by graphing.
y < x + 4
y ≥ x + 4
y ≥ x + 4
y ≥ x + 3
3x - y = 7
2x + y = 3
y = 4x+1
3x + 2y = 13
Match the following graphs to the systems of equations
y=32x+1
y=32x−2
y=−x+7 y=2x+1
y=−2x+4 y=−2x+4
Which of the following graphs would fit the system of equations?
y=2x−4
y=−21x+1
Identify the graph represented by the following system of inequalities.
2x - y > 4
4x + 2y < 6
Which of the following is NOT a solution to this system of inequalities?
(0,-1)
(0,3)
(4,0)
(6,-2)
y < 3
y > 3
y < 3
y > 3
Which point is not a solution?
(1, 6)
(-1, 1)
(3, -2)
(5, 0)
y < 2
y < 2
y < 2
y < -2
Carlos works at a movie theater selling tickets. The theater has 300 seats and charges $7.50 for adults and $5.50 for children. The theater expects to make at least $2000 for each showing
7.5x+5.5y≥2000
7.5x+5.5y≥2000
7.5x+5.5y≤2000
7.5x+5.5y≤300
Luka and Dana are making cookies for the Westland Pantry. They only have up to 6 hours to bake! They can bake 32 chocolate chip cookies in an hour (x), and 20 snickerdoodle cookies in an hour (y). They need to make at least 150 cookies. Which inequalities represent the situation?
x + y ≥ 6
32x + 20y ≤ 150
x + y ≥ 632
x + 20y ≥ 150
x + y ≤ 6
32x + 20y ≤ 150
x + y ≤ 6
32x + 20y ≥ 150
What's the difference between systems of equations and systems of inequalities?
Systems of equations have 1 solution, no solution, or infinite solutions while systems of inequalities can have a range of solutions.
Systems of equations use slope-intercept form only while systems of inequalities use standard form only.
Systems of equations have a shaded region while systems of inequalities do not.
There is no difference.
JoAnn likes her job as a baby-sitter, but it pays only $3 per hour. She has been offered a job as a tutor that pays $6 per hour. Because of school, her parents only allow her to work a maximum of 15 hours per week. JoAnn wants to to tutor and baby-sit and make at least $66 per week. Formulate an system of inequalities to model how many hours per week she can work at each job.
3b + 6t > 66
3b + 6t < 66
b + t < 66
b + t < 66
Cole is doing a basketball challenge for charity. In order to win money for the charity, he needs to score at least 20 points in less than 10 shots. If x is the number of 2-point shots, and y is the number of three point shots, which inequalities below represent the situation?
x + y < 10
2x + 3y ≥ 20
x + y ≤ 10
2x + 3y ≥ 20
x + y ≤ 10
2x + 3y > 20
x + y < 10
2x + 3y > 20
If an expense can NOT be removed from your budget to save money, it is considered a _____.
Income
Want
Need
Savings
If Joshua's budget for rent is 22% of salary, then
how much is budgeted for rent?
If Callie's budget for rent is 29% of salary, then
how much is budgeted for rent?
If Landon's budget for transportation is 15% of his salary, then how much is budgeted for his car payment?
If Polly spends $500 per month on her rent, what percentage of her budget is she spending on housing?
What is Joshua's monthly salary?
$2735.33
If Madison plans to save $1,684 per month, how many months will be necessary to save?
If he budgets 30% towards his housing expenses but only spends $650 per month on his rent, how much is saving per month on housing?
Jacob has several annual homeowner expenses including yearly payments of $2,598 for insurance and $156 for property tax.
How much must be saved each month if Jacob is going to have enough money at the end of the year to make the payments?
Allie averages a weekly net income of $290 from her job at Kohls. How much does she average per month?
$1243
Over $73
Under $73
What is a budget
A plan for using your money over a set period of time.
what you give up in order to get something else.
Saving money
A waste of time
helps you meet goals
A budget is a way to track and manage your
income and expenses
math skills
communication skills
If you are spending more than you earn, you should
stop keeping track
cry
change your spending and your budget
Which part of your budget should you plan to pay first
housing (rent or mortgage)
entertainment
eating at restaurants
new clothing
If you are spending too much, what part of your budget should you look to try to save money
housing
insurance
entertainment
When should you use a credit card?
whenever you want
when you can pay off the entire amount before the payment is due
when you are spending more than you earn
Which part of your budget is fixed and will probably be the same each month unless you make a major change?
clothing
food
entertainment
rent
