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