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Saving & Investing Test Review Flashcards | StudBud
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Saving & Investing Test Review
Saving & Investing Test Review
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1
Two things that should make you want to start saving and investing early in life are
Principal and Time
Principal & Interest
Time & Compounding
Interest & Time
2
Rent would be income associated with
Stocks
Real estate
Mutual funds
Bonds
3
Dillon wanted to open a savings account and begin an investment plan, he should go to
Bank/Credit Union
The Internet
Brokerage firm
Insurance company
4
A retirement plan approved by the IRS exclusively for self-employed individuals
Roth IRA
Traditional IRA
Keogh Plan
Roth 401K
5
Professional management, diversification, easy to start and add to are characteristics of
Savings accounts
Real estate
Mutual funds
Trust funds
6
Mutual funds experience compounding through the
Time value of money
Dividend reinvestment plan
Interest earned
Additional contributions from the owner
7
What do CDs, Money Market Accounts and Regular Savings Accounts have in common?
Top of Investment Pyramid
Purchased through stock brokers
FDIC Insured
High rate of return, high investment risk
8
Bonds and savings accounts both earn ___ for the owner.
Rent
Interest
Capital gains
Dividends
9
FDIC/NCUA depositor insurance covers bank deposits up to
$1,000,000
$500,000
$100,000
$250,000
10
Corporate, Federal Government, Municipal are
Types of bonds
Types of mutual funds
Types of savings accounts
Types of brokerage firms
11
On the investment pyramid, the safest and lowest return investments are
In the middle
On the bottom
Spread throughout
On top
12
Which type of stock gives the shareholder voting rights in a corporation?
Preferred
Common
13
Annuities are contracts with ____ that offer income in the future.
Stock exchanges
Brokerage firms
Banks
Insurance companies
14
When establishing an emergency fund, remember it is a large goal and
Set smaller goals to reach first some is better than none
It should be the most important goal give up everything else
Don't start until you can reach the goal in 3 years
If the goal looks too big, don't bother
15
Mary has a 401K, several CDs, U S Savings Bonds, and Mutual Funds; this makes up Mary's
Portfolio
Asset allocation
Bank accounts
Investment club
16
Oversees the trade of securities markets, stock exchanges and licenses brokers.
FDIC
Securities & Exchange Commission
Federal Reserve
Treasury Department
17
Making savings & investing your most important expense.
Pay yourself first
Buy & hold
Asset allocation
18
Earnings and principal in an account are not taxed until they are withdrawn.
Tax deductible
Tax exempt
Tax deferred
19
An increase in the market value of an asset.
Dividends
Interest
Depreciation
Capital gains/Appreciation
20
If you wanted to save up to take your significant other to prom you would probably use
Mutual fund
Checking account
Corporate bond
Regular savings account
21
Burns bought 100 shares of Google for $567.00 per share, how much did the purchase cost?
$5,670
$56,700
$567,000
22
How much of net pay do the experts recommend goes toward saving and investing?
30%
At least 10%
50%
25%
