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WorksheetsEarning Interest - Segment Test (4 Assessments)
Total questions: 25
Worksheet time: 13mins
How is interest usually expressed?
As a single annual payment
As a penalty
As a percentage
As a reward
The early Christian church forbids using interest.
True
False
How are government bonds obtained?
By leasing government property
By donating to government agencies
By purchasing government services
By loaning money to the government
Which of the following is the term for the amount invested?
Installment
Principal
Certificate of deposit
Money market fund
If the annual interest rate is 24 percent, what is the monthly interest rate?
24 percent
12 percent
6 percent
2 percent
When April was born, her parents placed $500 in a savings account to give to her on her 18th birthday. The interest rate on the account is one percent and it is a simple interest account. How much will April have in the account on her 18th birthday?
$500
$590
$900
$1,400
The amount earned on an investment is known as which of the following?
Price
Principal
Compound
Return
The amount earned on simple interest grows much faster than the amount earned on compound interest.
True
False
Where money is placed should be based on the amount of __________ an individual is willing to take and the amount of __________ they wish to receive. *(IMPORTANT: Must Capitalize the First Letter in Each Word for Your Answer)
(Example of answer format: Now; Then)
(a)
Compound interest involves earning interest on principal and on interest previously earned.
True
False
The formula for estimating how long it will take for an investor to double his/her money is known as which of the following?
The cash flow formula
The rule of 72
The leverage ratio rule
The adjusted return formula
Which of the following is NOT a way market interest rates affect the U.S. economy?
Investing
Inflation
Spending
Regulation
The Federal Trade Commission is the agency regulating financial institutions and managing the nation’s money.
True
False
Which of the following is NOT a reason lenders charge interest on loans?
To compensate for risks taken
To pay for the costs of lending
To pay for federal lenders’ fees
To compensate for inflation
Interest rates for loans are sometimes negotiable.
True
False
What is interest?
The amount invested
A fee paid for the use of money
A type of bank account
The formula for estimating investment returns
Which of the following are ways to earn interest?
A. Bank savings account
B. Government bonds
C. Money market funds
D. All of the above
When did England begin using interest as we know it today?
A. During the 16th century
B. During the 17th century
C. During the 18th century
D. During the 19th century
Which is NOT a type of interest?
A. Complex
B. Simple
C. Compound
D. Market interest rates
What is the formula for simple interest?
A. I = P x R x T
B. I = P + R + T
C. I = P x R / T
D. I = P + R(T)
What does the P stand for in the simple interest formula?
A. Price
B. Procurement
C. Principal
D. Party
Which is more powerful, simple interest or compound interest?
A. Simple interest
B. Compound interest
The rule of 72 is a rough estimation of how long it will take an investor to (a) their money.
*(IMPORTANT: Must Capitalize the First Letter in Each Word for Your Answer)
(Example of answer format: Then)
If Rick places $1,000 into a savings account which earns nine percent, it will take approximately how many years to turn the $1,000 investment into $2,000?
A. Four years
B. Six years
C. Eight years
D. Ten years
What is the central banking system of the United States?
A. The Federal Trade Commission
B. The Department of the Treasury
C. The Federal Financial Institutions Council
D. The Federal Reserve
