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Essentials of Investments - SEED

Total questions: 12

Worksheet time: 6mins

Name
Class
Date
1.

Which stock market index focuses mainly on technology companies?

a)

Dow Jones

b)

S&P 500

c)

NASDAQ

d)

Russell 2000

2.

What is it called when a company begins publicly selling its shares?

a)

Primary Sale

b)

Initial Public Offering (IPO)

c)

First Public Offering (FPO)

d)

Bankruptcy

3.

Which factor is most likely to raise a company's stock price?

a)

A new competitor

b)

A name change

c)

Being sued by the government

d)

Higher expected earnings

4.

Which of these is the least risky type of investment?

a)

Stocks

b)

Bonds

c)

Crypto

d)

Options

5.

What is the term for the increase in the value of an investment?

a)

Buy and hold

b)

Compound interest

c)

Capital gain

d)

Initial public offering

6.

Which type of account allows you to claim a tax deduction on your contributions?

a)

Roth IRA

b)

Traditional IRA

c)

High yield savings account

d)

Hedge fund

7.

What is the term for interest accumulating on itself over time, leading to rapid growth?

a)

Capital gains

b)

Linear interest

c)

Compound interest

d)

Tax-exempt interest

8.

Which type of account offers an employer match?

a)

401k

b)

Roth IRA

c)

Traditional IRA

d)

Brokerage

9.

You are 22 years old. In general, how much of your portfolio should be invested in stocks (a risky asset)?

a)

0-10%

b)

90-100%

c)

40-50%

d)

150%

10.

What is a good strategy to take care of your credit score?

a)

Build an emergency fund

b)

Pay off high-interest debt first

c)

Invest in debt instruments (such as bonds)

d)

Cancel your credit cards

11.

What is a possible red flag among investment/finance "gurus"?

a)

Clear credentials and qualifications

b)

SEC license

c)

Trying to sell you products

d)

Fiduciary standard

12.

What is a fiduciary's top priority?

a)

Lower taxes for the client

b)

The client's overall financial best interest

c)

Maximizing the number of clients

d)

Selling insurance