WorksheetsF24TH - Saving and Investing
Total questions: 83
Worksheet time: 42mins
Name
Class
Date
1.
Which of these statements about savings accounts is NOT true:
a)
Most are insured up to $250,000
b)
They are low risk
c)
They are a good place for an emergency fund
d)
They earn a good Return on Investment
2.
What is the most that you can contribute to an IRA each year:
a)
$22,500
b)
$6,500
3.
What is the most that you can contribute to a Roth each year:
a)
$22,500
b)
$6,500
4.
What is the most that you can contribute to a traditional 401(k) each year:
a)
$22,500
b)
$6,500
5.
If you want to contribute more than $6,500 each year to a Roth or IRA, you can:
a)
Open a savings account
b)
Open a checking account
c)
Contribute money to a 401(k), then withdraw the money and invest it in a Roth or IRA.
d)
Contribute money to a 401(k), then convert the money to a Roth or IRA.
6.
In a limited partnership, who is liable for obligations of the partnership?
a)
Only the limited partners
b)
Only the general partners
c)
Both the general partners and the limited partners
d)
None of the partners are liable for obligations of the partnership
7.
What is ACRS?
a)
A tax advantage created to encourage investment in public education
b)
A method of depreciation that lets investors reduce the depreciation expenses
c)
A method of depreciation that lets investors increase the depreciation expenses
d)
None of these
8.
Which of these is NOT a good place to put your money if you want to earn a good return:
a)
Stocks
b)
Bonds
c)
Savings Account
d)
Investing
9.
Returns from stocks can come from which of these:
a)
Income generated by the investment
b)
Increases in the market price of the investment
c)
Either of these
d)
Neither of these
10.
Generally, the greater the risk, the potential return:
a)
Is greater
b)
Is smaller
c)
Stays the same
11.
_____ are used to buy a share of a company.
a)
Stocks
b)
Bonds
c)
Mutual funds
d)
Index funds
12.
____ are used to loan money to a company or to state or federal governments.
a)
Stocks
b)
Bonds
c)
Mutual funds
d)
Index funds
13.
____ are used when you want a fund manager to decide what stocks or bonds to buy or sell.
a)
Stocks
b)
Bonds
c)
Mutual funds
d)
Index funds
14.
____ are used when you want your investments to be based on the market caps of the S & P 500.
a)
Stocks
b)
Bonds
c)
Mutual funds
d)
Index funds
15.
_______ try to "be the market" instead of "beating the market" — buying stocks of every firm listed on an index to mirror the performance of the index as a whole.
a)
Stocks
b)
Bonds
c)
Mutual funds
d)
Index funds
16.
Income from bonds come as ______
a)
Dividends
b)
Interest
c)
Both of these
d)
Neither of these
17.
The value of a stock _____ as the market price of the stock goes up.
a)
Goes up
b)
Goes down
c)
Stays the same
18.
The value of a bond _____ as the market interest rates go up.
a)
Goes up
b)
Goes down
c)
Stays the same
19.
If you sell stock for more than you paid for it, the money that you make when you sell it is called _____ .
a)
Ordinary income
b)
Capital gain
c)
Both of these
d)
Neither of these
20.
If you buy stocks in a company, the dividends you recieve are normally taxed at the ____ _____ rates:
a)
Long-Term Capital gain
b)
Ordinary income
21.
If you buy stocks in a company, and two years later sell the stock for more than you paid for it, the profit is taxed at the ____ _____ rates:
a)
Long-Term Capital gain
b)
Ordinary income
22.
Long-term capital gain is taxed at _____ rates than ordinary income.
a)
higher
b)
lower
c)
the same
23.
If your employer takes money out of your paycheck and puts it into a Roth, you will pay income taxes on that money:
a)
When you get your paycheck
b)
When you retire and take money out of your retirement account
c)
Neither of these
d)
Both of these
24.
If your employer matches the money that you put it into a Roth, you will pay income taxes on the employer's contributions:
a)
When you get your paycheck
b)
When you retire and take money out of your retirement account
c)
Neither of these
d)
Both of these
25.
If your employer takes money out of your paycheck and puts it into a 401(k), you will pay income taxes on that money:
a)
When you get your paycheck
b)
When you retire and take money out of your retirement account
c)
Neither of these
d)
Both of these
26.
If your employer matches the money that you put it into a 401(k), you will pay income taxes on the employer's contributions:
a)
When you get your paycheck
b)
When you retire and take money out of your retirement account
c)
Neither of these
d)
Both of these
27.
Which of these are ways that early withdrawals from a 401(k) will cost you money:
a)
You pay taxes on the withdrawal
b)
You pay a penalty on the withdrawal
c)
The money that you take out is no longer earning a return that increases your retirement fund
28.
As a general rule, you should invest or save ____ % of your income.
a)
10
b)
110
c)
75
d)
All of these
29.
As a general rule, to figure out the percentage of your investements that should be stocks or other equity, subtract your age from _____ .
a)
10
b)
110
c)
75
d)
All of these
30.
As a general rule, your annual income after retirement should be about ____ % of the annual income that you earned before retirement.
a)
10
b)
110
c)
75
d)
All of these
31.
If your annual income before you retire is $100,000, your annual income after you retire should be about $ _______ thousand.
a)
75
b)
10
c)
90
d)
50
32.
If your annual income is $100,000, you should save or invest about $ _______ thousand each year.
a)
75
b)
10
c)
90
d)
50
33.
If you are twenty years old, your investments for your retirement should be about ____ % in stocks.
a)
75
b)
10
c)
90
d)
50
34.
If you invest in a Treasury Bonds that pay 1% interest per year, your investment will double in ____ years.
a)
10
b)
50
c)
72
d)
144
35.
If you charge $10,000 on a credit card with a 24% annual interest rate, and you don't make any payments to the credit card, the amount you owe will double in about ____ years.
a)
72
b)
144
c)
3
d)
7
36.
Would you rather :
a)
Have $1,000,000
b)
Start with a penny and double your money every day for 30 days
37.
If your money doubles each day:
a)
That is a 100 % daily growth rate (aka ROI)
b)
This an unrealistic growth rate (aka ROI)
c)
Both of these
d)
Neither of these
38.
Your retirement fund will be bigger if you start investing:
a)
a little at age 25
b)
a lot at age 35
39.
You can put in up to $7,000 a year into:
a)
An IRA
b)
A Roth
c)
A 401(k)
d)
All of these
e)
Noneo f these
40.
You can put in up to $23,000 a year into:
a)
An IRA
b)
A Roth
c)
A 401(k)
d)
All of these
e)
None of these
41.
Which of these are true statements about how much you should SAVE for your retirement:
a)
None of these are true - you should invest for your retirement, not save.
b)
You should save enough to replace 70% of your annual pre-retirement income.
c)
If you know you won’t have a mortgage, you may not need to replace as much of your pre-retirement income.
d)
If you want to travel every year, you might need to replace more than 70% of your pre-retirement income.
e)
All of these are true about how much you should save for your retirement.
42.
Which of these are true statements about how much you should INVEST for your retirement:
a)
None of these are true - you should save for your retirement, not invest.
b)
You should invest enough to replace 70% of your annual pre-retirement income.
c)
If you know you won’t have a mortgage, you may not need to replace as much of your pre-retirement income.
d)
If you want to travel every year, you might need to replace more than 70% of your pre-retirement income.
e)
All of these are true about how much you should invest for your retirement.
43.
Because of inflation, the amount you have saved today likely _____ 20 to 30 years from now.
a)
won't go as far
b)
will go farther
c)
both of these are true
d)
neither of these are true
44.
Full Social Security benefits currently begin at age ____ .
a)
67
b)
62
c)
57
d)
72
45.
Early social security retirement benefits are available at ____ , but at a lower monthly amount.
a)
67
b)
62
c)
57
d)
72
46.
Mid-cap companies are those with capitalization between $2 and $10 billion, while _____ companies have less than $2 billion, and large-cap companies have over $10 billion in market capitalization.
a)
small-cap
b)
Mid-cap
c)
large-cap
47.
_____ companies are those with capitalization between $2 and $10 billion, while small-cap companies have less than $2 billion, and large-cap companies have over $10 billion in market capitalization.
a)
small-cap
b)
Mid-cap
c)
large-cap
48.
Mid-cap companies are those with capitalization between $2 and $10 billion, while small-cap companies have less than $2 billion, and _____ companies have over $10 billion in market capitalization.
a)
small-cap
b)
Mid-cap
c)
large-cap
49.
As a general rule, _____ companies have the highest potential return, but they also come with the highest risk.
a)
small-cap
b)
Mid-cap
c)
large-cap
50.
As a general rule, _____ companies have the lowest potential return, but they also come with the lowest risk.
a)
small-cap
b)
Mid-cap
c)
large-cap
51.
Over the past 20 years, mutual fund managers have done ____ the S & P for All Domestic Funds.
a)
Better than
b)
Worse than
c)
The same as
52.
Fees for mutual fund managers are usually _____ fees for index funds.
a)
Higher than
b)
Lower than
c)
The same as
53.
When a person invests their money, what can they be certain of?
a)
The value of their investment will only increase.
b)
The value of their investment will only decrease.
c)
The value of their investment will change over time.
d)
The value of their investment will never change.
54.
Which is a benefit of keeping money invested for long periods of time?
a)
There may be more chances for the value of investments to increase.
b)
There may be more chances for the value of investments to drop to zero.
c)
There may be more chances for the value of investments to be forgotten.
55.
Who do you think is credited with discovering the Rule of 72?
a)
George Washington
b)
Warren Buffett
c)
Albert Einstein
d)
Jake Logan
56.
What did Einstein say about compound interest?
a)
It's more important than bread.
b)
It's the eighth wonder of the world.
c)
It's the wave of the future.
d)
It'll cure cancer.
57.
What is the math formula for Rule of 72?
a)
72 x Interest Rate = Years to double your money
b)
72 x Years to double your money = Interest rate
c)
72 ÷ Interest rate = Months to double your money
d)
72 ÷ Interest rate = Years to double your money
58.
So if it takes 9 years to double your money, and you started with $1,000, how much will you have in 9 years? How much will you have in 18 years?
a)
$2,000 in 9 years
b)
$4,000 in 18 years
c)
$9,000 in 9 years
d)
$81,000 in 18 years
e)
$36,000 in 18 years
59.
What is the key to making sure the Rule of 72 works for you?
a)
Having a high interest rate to start with that stays at that rate
b)
Having a low interest rate to start with that gets lower each year
c)
Having a high interest rate to start with that gets lower each year
d)
Having an interest rate that bounces up and down every year
60.
Which of these are true about savings accounts:
a)
They are very liquid
b)
They are very safe
c)
Both of these
d)
Neither of these
61.
Savings Bonds and Certificates of Deposit offer a higher interest rate than savings accounts. What is the biggest disadvantage of these investment types?
a)
Both options pay a variable rate of interest.
b)
Both options require a high principal amount of $10,000.
c)
Both options have a current interest rate below 1%.
d)
Both options will charge a penalty if you withdraw your money early.
62.
Which of the following investment types offers the highest risk, but also the highest potential return?
a)
Savings Account
b)
Certificate of Deposit
c)
Bond Funds
d)
Stocks
63.
Which of these are true statements about diversification:
a)
It is investing in different types of investments
b)
It reduces risk because if one type of investment loses value, only part of your investment declines.
c)
It reduces return because not all types of investment will increase in value.
d)
All of the above
64.
If we had a POSITIVE return on an investment, what would that mean?
a)
That we lost money from the investment
b)
That we gained money from the investment
c)
That we broke even from the investment
65.
We want our ROI to be:
a)
Positive
b)
Negative
c)
More than the inflation rate
d)
Less than the inflation rate
66.
Which of the following expenses is money in a savings account not intended for?
a)
Expensive video equipment someone plans to buy in two years
b)
Car repairs someone might need following an accident
c)
Tickets to a movie someone would like to see tomorrow
67.
Saving money for car repairs is an example of:
a)
Mechanical
b)
Medical
c)
Moving
d)
Moving on to a new job
68.
Profits earned by credit unions are returned to you as:
a)
Reduced fees
b)
Better loan terms
c)
Higher savings rates
d)
All of these
e)
None of these
69.
Profits earned by banks are returned to you as:
a)
Reduced fees
b)
Better loan terms
c)
Higher savings rates
d)
All of these
e)
None of these
70.
Normally, credit unions can pay higher interest rates on your savings account because:
a)
They don't have to pay dividends to shareholders
b)
They don't have to pay income taxes
c)
Both of these
d)
Neither of these
71.
When discussing the stock market, what is the difference between trading and investing?
a)
Trading is long-term focused, while investing is not
b)
Investing is long-term focused, while trading is not
c)
Trading is free, while investing is not
d)
Investing is free, while trading is not
72.
Which of these describes "investing"
a)
Buying an asset and holding the asset even as prices go up and down
b)
Buying and selling assets frequently, hoping to earn quick profits
c)
Both of these are investing
d)
Neither of these is investing
73.
Which of these describes "trading"
a)
Buying an asset and holding the asset even as prices go up and down
b)
Buying and selling assets frequently, hoping to earn quick profits
c)
Both of these are trading
d)
Neither of these is trading
74.
Which of these statement about risk is true:
a)
Selling short is riskier than buying long, because the amount you can lose is unlimited.
b)
Buying long is less risky than selling short, because the amount you can lose is limited to the price you paid for the stock.
c)
Selling short is riskier than buying long, because it is a short-term strategy.
d)
All of these are true
e)
None of these are true
75.
Which of these statements about investing and trading are true:
a)
All of these are true
b)
Millions of people have used long-term investments to build wealth for things like buying a house and funding their retirement
c)
About 90 % of poeple who trade instead of invest lose money
d)
Only about 10 % of poeple who trade instead of invest make money
e)
You should only trade with money that you can "afford to lose"
76.
Which has a higher risk of loss:
a)
Trading
b)
Investing
c)
Both of these are risk-free.
77.
What is a "pump and dump" scheme?
a)
When fraudsters call you from a "scam likely" number
b)
When fraudsters promote scam companies that don't exist on social media
c)
When fraudsters hype up an investment and then sell their shares
d)
When fraudsters pay previous investor returns with funds from new investors
78.
The Securities & Exchange Commission (SEC) is a US government agency responsible for:
a)
Making sure that anyone trading securities is being fair and orderly.
b)
Making sure that crypto scammers are put in jail
c)
Protecting the NYSE from any attacks
d)
Holding all US money deposited into bank accounts or investment accounts
79.
Why is the seller or promoter of a product not a strong source of information for your research?
a)
They are likely to show you the bad news about their products
b)
They are probably not good at their job
c)
They are unbiased about the product they're selling
d)
They have a vested interest in making the sale
80.
True or False. Bitcoin would be a good place to save money for an emergency fund.
a)
True
b)
False
81.
Albert Einstein is credited with saying that ____ is the most powerful force in the universe.
a)
Compound interest
b)
Mass
c)
Energy
d)
The speed of light
e)
Gravity
82.
Compound interest is:
a)
Interest earned on the amount that you invest
b)
Interest earned on the interest that your investment has already earned
c)
Both of these
d)
Neither of these
83.
For every ten years that you wait to start investing, you must invest ______ to end up with the same amount when you retire.
a)
about 10% more
b)
about 50% more
c)
about 100 % more
d)
none of these - retirement is so far in the future that waiting ten years to start won't matter
100 %
