WorksheetsInvesting Quiz
Total questions: 18
Worksheet time: 9mins
A type of investment that invests in a lot of different companies is called
Stocks
Bonds
Mutual funds
T-bills
What is a stock?
A loan an investor makes to a company or government that pays interest over time.
A share of ownership in a company
A collection of investments sold as a package.
An option to purchase something in the future at todays price.
Spreading your investments around to inrease financial security
Risk assessment
Diversification
Stocks, bonds & cash
Liquidity trap
Professionally managed, diversified investment that pools resources of many investors
Treasury bonds
Stock index
Mutual fund
Saving account
The number of years it takes for your money to double
72 Rules
Rule of 72
Diversification is important in investing because…
It helps you to balance your risk across different types of investments.
It increases your overall risk, which guarantees that you will make more money.
It ensures that you only make low-risk investments.
It helps you gain the highest rate of return despite any risks.
Which of the following correctly orders the investments from LOWER risk to HIGHER risk?
Treasury bond − Stock − Diversified mutual fund
Stock − Treasury bond − Diversified mutual fund
Treasury bond − Diversified mutual fund – Stock
Diversified mutual fund − Treasury bond − Stock
Which investment is the most risky?
bond
stock
mutual fund
savings account
Which type of investment is the least risky?
stock
bond
mutual fund
savings account
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?
Your money grows faster when it is compounded
Your taxed on simple interest, but not compound 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
What is Social Security?
Social Security is a private retirement fund run by your company
Social Security is another name for a 401(k)
Social Security is a government run retirement program
Social Security is a program that matches your 401(k) contributions
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
A person who is licensed to buy and sell stocks on behalf of others, provide investment advice, and collect a commission on each purchase or sale is called a __________.
Bank clerk
Accountant
Stock Broker
Retail Investor
A bond is a _________.
Type of debt that a company issues to investors for a specified period of time
Share of ownership in a company
Mutual funds are ______.
Speculative investments that are managed without fees
Diversified investments comprised of a variety of stocks and bonds
A company needs to raise cash to expand, but it does not want to issue stock. A company can raise cash by selling _________ and paying interest.
Bonds
Contracts
