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Investments Flashcards | StudBud
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Investments
Investments
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StudBud Administration
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Investment unit review.
Flashcards
40 cards
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Practice quiz
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Host live
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Questions
40
Answers
1
Which of the following statements is true in regards to paying taxes on investments?
Only have to be paid on employer‐sponsored investments
Taxes are often owed on profits generated from investments.
Investments are considered unearned income they aren't paid
2
KP wants to purchase stocks. Who would she contactto make the transaction?
A real estate agent
The New York Stock Exchange
A brokerage firm
complete this transaction on her own
3
How liquid is a savings account?
More liquid than a Certificate of Deposit
Less liquid than mutual funds
More liquid than cash
More liquid than a checking account
4
What are the most common tax advantage investments?
Education
Mutual Funds
Retirement
Retirement and Education
5
The chance of loss from an event that cannot be entirely controlled
Rate of loss
Return
Reward
Risk
6
Simple interest is best defined as
Interest earned on the principal investment
The effect interest has on the total return on investment
Any form of interest earned from saving or investing
Earning interest on interest
7
Investments have the potenal to:
Earn higher rewards and build wealth.
Make you broke.
Earn lower rewards and distinguish wealth.
8
Investing for rerement is
not important.
not required.
must be carefully planned over a long period of me
when the government pays for you.
9
A form of lending to a company or the government (city, state, or federal)
Rent
Bond
Brokerage firm
Index fund
10
Which of the following is a feature of a money market deposit account?
Tiered interest rates
No minimum balance requirements
Unlimited transactions every month
Money must remain in account for a specific period of time
11
When you own a stock, you expect that the market price which is
Return
Gain
Market price
12
Specified time in the future when the principal amount of thebond is repaid to the bondholder
Maturity Date
Morning
Mutual Fund
Market Price
13
Facilitates the buying and selling of investments from a stock exchange
Credit Unions
Banks
Bond
Brokerage Firm
14
A company combines the funds of many investors&invests in diversified portfolio of investments
Mutual fund
Bond
Stock
Index Fund
15
An individual’s investment philosophy changes throughout their lifetime.
False
True
16
Types of return on mutual and index funds
Futures
Stock
Interest, dividends, rents, capital gains
home ownership
17
Have the potential for significant fluctuations in return over a short period of time
Speculativeinvestments
Mortgage
Portfolio diversification
Inflation
18
The owner of a stock
Neither
Stockholder
Shareholder
Both Stockholder orShareholder
19
You own something with other investments, such as:
Speculative Investments
Stocks
None
Real Estate
20
Organized, central service to buy and sell stocks, bonds and other investments that aretraded
Stock
Wall Street
Wells Fargo
Stock Exchange
21
You are lending money with some investments, such as:
Mutual Funds
Bonds
Stocks
22
The profit or income generated by saving and investing
Risk
Rent
Return
Rate of Interest
23
Investments have the potential for..
Low
No
High
Some
24
Investments shouldn't be used for savings or short‐term goals because of two primary reasons:
Investments are not secure and are more liquid than savings
Investments are not secure and are less liquid than savings
Investments are secure and are less liquid than savings
25
Which statement is the most correct description of liquidity?
The amount of savings available
How quickly and easily an asset can be converted into cash
The amount of savings available
Money needed to pay for the necessities
26
A trained professional that helps people make investing decisions
Financial Advisor
Broker
Banker
Dividend
27
Ownership of residential orcommercial property or land
Rent
Real Estate
Selling
Home loan
28
Which statement best reflects the philosophy of “pay yourself first”?
Spend before you save
Save before you spend
pay all fixed expenses before paying flexible expenses
save whatever money is left over after paying monthly bills
29
Taxes must be paid on all investment profits in the year the unearned income is received.
False
True
30
A share of ownership in a company
Shareholder
CDO
Stock
Speculative Investment
31
A mutual fund designed to reduce fees by investing in the stocks and bonds thatmake up an index
Bond
Mutual Fund
Index Fund
Index
32
Wealth =The rate of return earned on an investment should behigher than the rate of inflation.
True
False
33
The share of profits distributed in cash
Return
Dividend
Liquidity
Gain
34
Define investment philosophy
A group of similar stocks and bonds
Possibility investment will fail to pay the expected return
he rise in the general level of prices
An individual’s general approach to investment risk
35
The rise in the general level of prices
Inflation
Investment
Index
Igloo
36
The most common employee sponsored rerement plans are called:
301 K
401(k) and 403(b)
401K
101 K
37
When organizations pays interest to thelender (purchaser) until thematurity date is reached
Mutual Fund
Stock
Check
Bond
38
Which of the following is a feature of a certificate of deposit (CD)
Funds deposited can be accessed by check or debit card
Funds deposited in a CD have tiered interest rates.
Funds deposited in a CD are very liquid
Funds deposited in a CD are held for a certain amt of time
39
The return you earn on a savings tool or investmentis made by calculang the rate of return
Total Return multiplied by Amount of $ Invested
TotalReturn divided Amount of $ Invested
40
The most common relationship between risk and return in investing can be stated as
No relationship exists between risk and return
higher risk indicates lower return
lower risk indicates higher return
higher risk indicates higher return
