Personal Finance - Chapter 10

In Chapter 4, we learned about Working Savings. Which of the below is best represented by working savings

Money in a money market account or a savings account are considered to be low earning investments

Economics and world events are predictable

Selling stocks in a bull market while the price is high before a bear market

Which of the following is not a Tax Exempt Investment

During this market you will see investors doing a lot of buying which may cause a temporary rise in overall stock prices

This investment risk is best associated with the increase or decrease in taxes or laws that affect your investments

A prolonged period of rising stock prices and general feeling of investor optimism

Investments should always increase in value in the short term.

Going to Vegas and playing roulette has a better chance of a higher return than investing in a certificate of deposit.

There are no tax advantages to tax deferral savings

This type of investment risk is best associated with the actions that a company might take that affect your investment

The chance that changes in the business cycle will affect the value of an investment

Which of the following is not a high risk = high return potential investments

The chance that the factors affecting an industry as a whole will affect the value of an investment

A good investment strategy is to Buy Low and Sell High

Money set aside for unplanned expenses

Holding a variety of investments for the purpose of reducing overall risk

All investments have a positive Rate of Return

This document typically accompanies a will and outlines your end of life directive if you do not recover from an injury

A technique for making investment choices by following the prices of stocks over time

Dividends do not increase the principal of your investments

A performance measure used to evaluate the efficiency of an investment

A bond is a debt instrument and an investment instrument

A fund or an organization established and maintained for the purpose of supporting an institution or a cause

Which is not a characteristic of an ideal investment

Buying and selling stocks based on what the market is expected to do

A measure of how quickly an asset can be turned into cash

Most investment strategies are for the short term

This market is when optimism and consumer confidence is high.

Which is not an example of a risk free investment

The chance that activities or events that affect a company will change the value of an investment in that company

The chance that events unrelated to market trends will affect the value of an investment

This type of investment risk is best associated with rapidly rising prices

If you have faith in a company you should move all of your investments to that stock.

A debt instrument issued by a corporation or government

What is another name for saving

During this market is when you will see investors performing profit taking

This is the person that you outline in your will to ensure that your property is distributed as you outlined

At approximately what age should you start to plan your retirement

Gains will typically exceed losses over the 30-40 years of investing.

Which is not a purpose of savings and investing

Which type of wills is best described by a complicated document that would require lawyers to assist in writing.

In dollar cost averaging an investor does not have to study the trends or performance of a stock

This is the process of ensuring that your will is valid before distributing your assets.

A strategy that involves regularly setting aside cash that can be used to achieve goals

Usually later in life, when you are not working but are able to meet expenses through other income sources

Building Financial Security is a strategy that occurs

This market is when stocks lose value and investors are pessimistic.

Which of the following types of wills is best described by a software package that you can buy to generate a short will.

The chance that the rate of inflation will rise faster than your investment rate of return

An investment that is not subject to taxation

A collection of investments

Speculative investments are High Risk with Low Earning Potential

The chance that actions taken by the government will affect the value of your investment

A period of steadily decreasing stock prices and investor pessimism

The potential for change in the value of your investment

A professionally managed collection of stocks, bonds, in a diversified portfolio in one holding

When you see your investment portfolio rise in value, these are real increases in your wealth

Any place where investments are bought and sold

Which of the following types of wills is best described by a document that you write in your own handwriting.

Ownership interest in a publicly held company

If you die with out a will your estate is said to be in

Understanding the economy and the general conditions of the market can help to determine when to

Which of the following investment strategies does not have the strongest safety of principal strategy

A postponement of taxes to be paid

Inflation risk affects the principal in your investments.

Investing the same amount of money on a regular basis regardless of market conditions

A strategy to earn more on your money than the rate of inflation

The accumulation of assets over your lifetime

Unplanned or possible events

The purpose of investing is to keep pace with inflation

Money set aside for the future

This type of investment risk is best associated with the fluctuations in business cycles.

A strategy that involves a planned approach to making investments on a regular basis

The ability to meet current and future needs while living comfortably