Financial Literacy Review

Question 1

A CD is the most liquid investment

Accepted Answer

False

Question 2

In a 401(k) a company will match your investment up to a certain percent/

Accepted Answer

True

Question 3

Liquidity means

Accepted Answer

How easy it is to access your money

Question 4

Which investment is the most liquid?

Accepted Answer

Savings account

Question 5

Which index fund is the highest performing since inception?

Accepted Answer

S&P 500

Question 6

Ellen has $1,000 to be the start of her retirement fund. What do you think is a good investment strategy?

Accepted Answer

Invest $800 in a stock index fund and $200 in a bond index fund

Question 7

Select the statement below that accurately describes a characteristic of a credit card.

Accepted Answer

Making full payments on time every month is the only way to avoid interest

Question 8

Investing in a diversified portfolio of stocks guarantees that you won't lose money with your investments.

Accepted Answer

False

Question 9

How can your credit score impact your financial situation?

Accepted Answer

Your credit score determines whether you are approved for a loan and rate?

Question 10

IRA stands for Individual Retirement Account?

Accepted Answer

True

Question 11

What type of bond might your school district issue in order to build a new performing arts theater?

Accepted Answer

Municipal Bond

Question 12

Which would effect your checking account instantly?

Accepted Answer

Using a debit card to purchase gas

Question 13

Compound Interest is when your interest does not grow interest?

Accepted Answer

False

Question 14

You purchase 100 shares of Ravioli Den for $45/share. One year later, you sell them for $52/share. What was your gain?

Accepted Answer

$700

Question 15

I.P.O stands for

Accepted Answer

Initial Public Offering

Question 16

401(k) is the only retirement option

Accepted Answer

False

Question 17

As a young adult, all of the following are good strategies for building credit, EXCEPT:

Accepted Answer

Open a checking account, and start using a debit card

Question 18

A stock is?

Accepted Answer

Ownership of a company

Question 19

You invest $1,000 in a 5 year U.S. Treasury bond with a coupon rate of 5%. How much would you receive annually from this

Accepted Answer

$50 each year for the first four years and then $1,050 in the fifth year

Question 20

Rate of Return is another way of saying?

Accepted Answer

Interest rate

Question 21

Which of the statements below BEST describes the relationship between risk and return when considering an investment?

Accepted Answer

Investors expect to earn a lower return when investing in a low risk asset

Question 22

Which of the statements below BEST describes the relationship between risk and return when considering an investment?

Accepted Answer

Expect to earn a higher return when they invest in a high risk asset

Question 23

Social Security is enough for retirement?

Accepted Answer

False

Question 24

A mutual fund is?

Accepted Answer

More than one stock in a investment

Question 25

You bought 10 shares of stock in StreamingVideoCo for $45 per share. Two months later you sold them for $80 you made?

Accepted Answer

$350

Question 26

Which of these costs would be the MOST difficult to adjust if you were looking to reduce your expenses?

Accepted Answer

Loan payment on a new car

Question 27

Depending on the IRA you can pay taxes now or later?

Accepted Answer

True

Question 28

Elizabeth is considering buying a $30,000 car. Which of these financing options will have the lowest monthly payment?

Accepted Answer

$3000 down payment, 6% interest, 84 months

Question 29

Your friend has an interview tomorrow and is seeking his first job. Which of the following represents the WORST advice?

Accepted Answer

Don't ask questions during your interview.

Question 30

Which of the following is a reason not to invest in the S&P 500?

Accepted Answer

You want to "beat the market" with the return on your investment

Question 31

Which type of bond is generally considered "risk-free"

Accepted Answer

Treasury Bond

Question 32

You bought 10 shares of BigBlueCo for $100/share and later sold all of your shares for $80/share. What is your return %?

Accepted Answer

-20%

Financial Literacy Review

Questions 32

Financial Literacy Review

Questions 32