Saving & Investing
A diversified portfolio is desirable because
It decreases risk
What is a good strategy to help you save?
Pay yourself first - set aside money for savings each month
Use the chart below to answer the question. Why would Tyler choose a traditional 401(k) plan over a Roth 401(k) plan?
She wants a tax break this year
Use the chart below to answer the question. How do the investments in Column A compare to the investments in Column B?
The investments in Column A carry less risk.
How does inflation impact the money in your savings account?
The purchasing power of your money decreases over time
How is wealth defined?
Total Assets - Total Debts
Which is FALSE about Certificates of Deposit (CDs)?
You pay the bank some interest to keep $ in the CD
Use the spectrum below to answer the question. Which letter on the spectrum shows where "Certificates of Deposit" BEST fits?
a
If Oliver wants to make the MOST money on his savings account, he should look for a bank that pays interest how often?
daily
Use the passage below to answer the question. Which statement is BEST supported by the passage?
fees have a significant effect on return over time
What are some reasons for why so many Americans live paycheck-to-paycheck?
many people impulse shop
Which action do companies take to make people willing to invest in their companies?
they offer dividends on stocks
Which is NOT a typical goal for a savings account?
to buy groceries for this week
Michael began saving for his daughter Tamara's college education the year she was born. Initially he invested most of his money in mutual funds. Now that Tamara is fifteen and college is two years away, he has moved most of his money to certificates of deposit. Which reason BEST explains why he rebalanced his investment portfolio?
to reduce risk
Assuming a rate of growth of 8%, in how many years will your investment double?
9 years
Use the check below to answer the question. Paul is writing a check to his phone company for $75. Which letter on the check shows where he should sign his name?
d
Use the spectrum below to answer the question. Which letter on the spectrum shows where "Corporate Stocks" BEST fits?
d
The relationship between risk and return can be stated as
Higher risk indicates higher return
Use the check below to answer the question. Paul is writing a check for $125. Which letter on the check shows where he should write the words "One hundred twenty-five dollars and 00/100"?
b
Use the spectrum below to answer the question. Which letter on the spectrum shows where "Government Bonds" BEST fits?
b
Use the chart below to answer the question. "you are lending money" What is the BEST title for this chart?
bonds
Use the chart below to answer the question. Which of these BEST completes the chart?
bouncing a check
How does a company raise money through stock?
by selling shares of ownership to the public
Use the spectrum below to answer the question. Which letter on the spectrum shows where "Mutual Funds" BEST fits?
c
Frank is seventy years old and just retired from his job. His goal is to protect his life savings by placing most of his money in investments with the LEAST risk. In order to achieve his goal, where should he invest MOST of his money?
certificates of deposit
Use the chart below to answer the question. "relatively low risk" What is the BEST title for this chart?
certificates of deposit
Use the chart below to answer the question. What type of banking instrument does this chart MOST likely describe?
checking account
Which banking instrument usually pays the LOWEST interest rate?
checking account
Saving accounts differ from checking accounts in that...
checking accounts let you withdraw money an unlimited number of times
Ellen is 18 years old and plans to start investing $100 a month for her retirement at the age of 65. Where should she invest MOST of her money now if she wants to maximize her potential to build wealth?
mutual funds
Use the chart below to answer the question. "your money is combined" What is the BEST title for this chart?
mutual funds
Which is NOT a stock market index?
nyse
Use the chart below to answer the question. What happens as the pyramid is ascended?
risk increases and potential returns increase
Which of the following is FALSE about saving and investing?
saving generally has high returns
A key difference between saving and investing is
saving is emergencies & goals, investing is long-term wealth
Use the passage below to answer the question. Which advice is BEST supported by this passage?
start investing your money as soon as possible
Which would be considered the highest risk investment type?
stock
Use the chart below to answer the question. "by purchasing shares, you become" What is the BEST title for this chart?
stocks
Use the chart below to answer the question. Which of these would BEST replace the question mark at the top of the chart?
stocks
Why is it important to start investing as soon as possible?
you have more time for your money to compound
