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Saving & Investment Questions
Saving & Investment Questions
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Saving and investment questions to review for WISE Financial Literacy test.
Flashcards
25 cards
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Questions
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1
Farm products (such as wheat, corn, and cattle) and metals (such as gold and silver) are called
Options
Commodities
Futures
Collectibles
2
A pharmacy is to drugs as the American Stock Exchange is to:
Securities
Mutual funds
Investors
Stock advisers
3
The interest earned on United States Series EE Savings Bonds is
equal to the money paid to purchase it.
exempt from state and local taxes.
pd in a lump sum when the face value on the bond is reached.
deducted at the time of the bond's purchase
4
A daily newspaper that provides detailed coverage of the business and financial world is
Kiplinger’s Personal Finance
The Economist
The Wall Street Journal
Barrons'
5
A blue-chip stock can be described as:
A speculative stock
A stock that pays interest
A stock w/co. with a reputation for products and services
A preferred stock
6
Before the Kiss Corporation can issue stocks or bonds, it must register the issue with:
The World Bank
The Securities and Exchange Commission (SEC)
Its Board of Directors
The Federal Reserve
7
What is the largest equities market in the world?
American Stock Exchange (AMEX)
Over-the-counter (OTC) market
NASDAQ market
New York Stock Exchange (NYSE)
8
Buying a treasury bill (T-bill) is best for investors who are looking for
neither of these.
a higher yield on their investment than corp. bonds offer.
a secure, low risk investment
a place to invest between $100-$500.
9
Mutual funds:
Guaranteed to increase in value
An investment portfolio managed by the investor
Usually less risky than investing in a money market
Contains a wide range of different investment instruments
10
The greater risk you are willing to take, the greater the potential return.
True
False
11
Investor owns a stock that pays a $2/share. Reinvesting that dividend, means the $2.00 will go
towards buying more of the same stock.
towards buying stocks similar to those already owned
towards buying bonds in the corporation.
towards buying preferred stock in the corporation.
12
Which of the following is the
most
risky investment?
income fund
income and growth fund
growth fund
money market fund
13
Lu rec'd inheritance of $100,000. He plans to invest the $$. Which carries the greatest risk?
Common stocks
Bonds
Regular checking accounts
Savings account
14
A professionally managed grp of investments bought using a pool of money from investors is a
passbook account.
mutual fund
Ponzi scheme
savings bond
15
The phrase "don't put all your eggs in 1 basket" describes the following investment strategy?
Diversification
Return on investment
Pooling
Liquidity
16
What is the goal of an income fund?
to produce current income from interest alone
to earn returns from both dividends and capital gains
to make current income in the form of interest or dividends
to earn returns from capital gains alone
17
Chris bought stock for $4,000 and 1 year later he sold it for $5,000. His sale resulted in a:
market value
profit
yield
capital gain
18
With inflation, it takes more money to buy the same goods and services.
True
False
19
When you invest in stocks, you are helping businesses make and sell new products & services.
False
True
20
Which of the following is
most
likely to be an impulse purchase?
a candy bar
a new home stereo system
a new car
a house
21
Publicly held corporations:
Have stock that are held by public/outside investors
Are listed first on the New York Stock Exchange
Are not-for-profit organizations
Guarantee a positive return to investors
22
Advantages of investing in mutual funds include all of the following
except
diversification.
professional management.
liquidity.
a guaranteed rate of return
23
A factor that is likely to affect the market price of a stock is:
Wages
The age of the corporation
Corporate profits
The number of corporate employees
24
Dante Co.'s oil tanker collided w/a ship causing a major oil spill. Price of Dante stock will
decrease
flucuate
increase
remain unchanged
25
Investor buys a house that has 3 rental apartments. The profits may be lower because
taxes on the house are lowered
one of the apartments is not rented.
mortgage on the house is paid off.
tenant in an apartment decides to paint the hallways.
