An initial public offering (IPO) is

The first sale of stock to the public

The FDIC encourages savings by

Guaranteeing the safety of most bank accounts

Diversification is important in investing because…

It helps you to balance your risk across different investment types.

A regular payment that comes with owning a stock

Which of the following scenarios is the most likely result of the events listed above?

Jeremy may be required to pay a higher rate of interest on the loan

Why will a gifted football player almost invariably make many more times more money that an equally gifted violinist?

The market for football entertainment is larger

The Securities and Exchange Commission is

A government agency that protects investors

A legally binding agreement between rentor and owner

Which of these statements is true of an investor who buys a bond?

The investor has loaned money to a corporation or government

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Economics final review part 2

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Questions 20

Answers

1
Which type of account typically offers the best return on retirement investment?
401K
Checking account
IRA (Individual retirement account)
Savings account
2
An initial public offering (IPO) is
The first sale of stock to the public
A stock deemed risky
An offer to buy back stock
The sale of bonds to the public
3
The FDIC encourages savings by
Promoting investment in stocks and bonds
Using propaganda to show the importance of financial planning
Offering high interest rates to bank customers
Guaranteeing the safety of most bank accounts
4
Which of these financial products typically offers the greatest amount of liquidity?
Savings bonds
Checking accounts
Common stocks
Certificates of deposits (CDs)
5
Diversification is important in investing because…
It helps you gain the highest rate of return despite any risks.
It increases your overall risk, which guarantees that you will make more mo
It ensures that you only make low-risk investments.
It helps you to balance your risk across different investment types.
6
The main trade-off that all investors must consider is:
diversity vs. uniformity
risk vs reward
income vs. cost
stocks vs bonds
7
The first set of numbers (74894934) on the check represents the:
bank routing number
bank account number
member number
check number
8
A dividend is
A form of propaganda
The profit made from selling a stock
A regular payment that comes with owning a stock
The interest rate of a loan
9
When buying a stock in a company, you are:
diversifying your portfolio
loaning money to a company
investing in an index fund
buying a portion of a company
10
Which of the following scenarios is the most likely result of the events listed above?
Jeremy may be required to pay a higher rate of interest on the loan
Jeremy may be asked to reduce his spending before accepting the loan
The bank with decrease Jeremy’s monthly loan payments
The bank will increase the amount of Jeremy’s loan
11
Which of the following is a stock market?
New York Stock Exchange
Chicago Board of Trade
Junior Achievement
Dow Jones
12
Why will a gifted football player almost invariably make many more times more money that an equally gifted violinist?
You can get CTE from football
The violinist only has to sit, there’s little action
The market for football entertainment is larger
The football player has to practice more
13
Use the Rule of 72 to calculate how long it will take for your money to double if it’s earning 6% in interest:
36yrs
72yrs
12yrs
16yrs
14
The Securities and Exchange Commission is
A Stock Exchange
A government agency that offers loans to investors
A Stock Index
A government agency that protects investors
15
The term referring to the rate of yearly interest for your credit card is commonly known as:
Default rate
Grace period
APR
Credit line
16
The primary purpose of using the division of labor is to
Increase comsumption
Lower transaction costs
Distribute work evenly
Improve productivity
17
A lease is..
A legally binding loan for a car
A legally binding agreement between rentor and owner
The interest rate used for a loan
A loan for a home
18
Which type of bank account typically offers no interest or the lowest interest?
Checking
Money market
Savings
Certificate of Deposit (CD)
19
Which of the following is the best measure of the production or output of an economy?
Unemployment Rate
Standard of living
Gross Domestic Product
Stock index
20
Which of these statements is true of an investor who buys a bond?
The investor purchased a stock in the corporation
The investor has partial ownership of a corporation
The investor is guaranteed to always get a return on their investment
The investor has loaned money to a corporation or government

Economics final review part 2 Flashcards | StudBud