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WorksheetsFinancial Math - Earning Interest - Vocabulary Quiz
Total questions: 15
Worksheet time: 8mins
What is the fee paid to use money, usually expressed as a percentage?
Principal
Interest
Installments
Compound Interest
Which type of account pays interest on funds deposited in a bank?
Government Bonds
Money Market Funds
Bank Savings Account
Short-term Loans
What are bonds issued by the government that are tax exempt?
Bank Savings Account
Government Bonds
Money Market Funds
Short-term Loans
What is the term for the amount invested?
Interest
Principal
Installments
Annual Percentage Rate
What is the term for recurring amounts paid at a specified time, such as annually?
Principal
Installments
Interest
Short-term Loans
What type of loans have to be repaid within less than one year?
Government Bonds
Money Market Funds
Short-term Loans
Bank Savings Account
What is the resulting rate when interest rates are expressed in years?
Simple Interest
Compound Interest
Annual Percentage Rate
Annual Percentage Yield
Which formula is used to determine simple interest?
I = P * R * T
I = P + R + T
I = P / R / T
I = P - R - T
What involves calculating interest on principal and previously earned interest?
Simple Interest
Compound Interest
Annual Percentage Rate
Installments
What is the interest rate earned over a year taking compound interest into effect?
Annual Percentage Rate
Simple Interest
Annual Percentage Yield
Principal
What is the relationship between risk and rate of return?
Higher risk leads to a lower rate of return
Higher risk leads to a higher rate of return
Risk does not affect the rate of return
Risk and rate of return are inversely proportional
What is the Power of 72 used for?
Calculating the interest rate
Estimating how long it will take to double an investment
Determining the risk of an investment
Calculating market interest rates
How is the Power of 72 calculated?
By multiplying 72 by the interest rate
By adding 72 to the interest rate
By dividing 72 by the interest rate
By subtracting the interest rate from 72
What affects market interest rates?
The Federal Reserve only
Supply and demand of credit
The stock market
Government policies only
What is the Federal Funds Rate?
The rate at which individuals borrow from banks
The rate at which banks borrow from the Federal Reserve
The rate at which the government borrows from banks
The rate at which banks lend to individuals
