WorksheetsW!SE Test Prep INVESTING QUIZ (Part 1)
Total questions: 1
Worksheet time: 7mins
What is the primary goal of investing?
To spend money on goods and services
To save money for immediate use
To get your money working for you
To keep your money safe under your mattress
Which of the following is NOT a way to make money through investing?
Earning interest
Receiving dividends
Capital gains
Winning the lottery
What does ROI stand for?
Return Of Interest
Risk Of Interest
Return On Investment
Rate Of Inflation
What is compound interest?
Interest earned on the original investment only
Interest that remains the same every year
Interest earned on both the original investment and previous interest
A fixed interest rate for the life of the investment
How does the frequency of compounding affect the growth of an investment?
No impact on growth
Slows down growth
Stops growth after a year
Increases growth
What is the Rule of 72 used for?
Figuring out the total return on investment
Measuring the risk of an investment
Determining how long it takes for an investment to double
Calculating annual interest rates
What does liquidity refer to in terms of savings and investments?
The amount of money invested
The risk associated with an investment
The ability to convert to cash quickly
The interest rate of a savings account
What is a major difference between savings and investments?
Investments have high liquidity
Savings can be used for long-term goals
Investments cannot lose value over time
Savings prioritize ease of access over growth
What kind of risk might you face if a company you invested in goes bankrupt?
Interest rate risk
Market risk
Credit risk
Operational risk
What should your investment decisions be based on?
A random selection
The latest trends on social media
Your risk tolerance
The advice of friends and family
