Saving & Investing

Front 1

Kylee's Personal Finance class when has been discussing the importance of understanding liquidity and she is trying to explain the term to another student. Which statement is most correct description of liquidity?

Back 1

how quickly and easily an asset can be converted into cash

Front 2

When taking advantage of the time value of money, which of the following is most likely to result in the largest return?

Back 2

invest as long as possible and at the highest interest rate possible

Front 3

Compound interest rate is best defined as:

Back 3

Earning interest on interest

Front 4

Dylan is preparing a presentation about saving and the presentation rubric says that he must include an explanation of compounding interest. Which of the following statements would be the best one to include in his presentation to show that he understands compounding interest?

Back 4

Earning interest on interest

Front 5

When a goal has been set to save $100.00 a month for an emergency fun of $2,000.00, giving up food from the vending machine to achieve that goal is the:

Back 5

trade-off

Front 6

Which statement best reflects the philosophy of "pay yourself first"?

Back 6

An individual should set aside a predetermined amount of money for saving before using any of that money for spending

Front 7

In relation to the other options, how liquid is a savings account?

Back 7

More liquid than a Certificate of Deposit

Front 8

Hannah needs a savings tool to help her manage her everyday purchases. The savings tool needs to be very liquid and accessible. Which of the following savings tools should Hannah choose?

Back 8

Checking account

Front 9

Which of the following statements correctly describes the security level of savings tools?

Back 9

Savings tools are secure because they are protected by the U.S gov't against loss.

Front 10

Brett plans to save money toward purchasing a car. His co-worker is telling him about a Money Market Account he has that offers a tiered interest rate. What is Brett's co-worker talking about?

Back 10

the amount of money he earns depends on the balance, i.e. the higher the account balance the higher the interest rate he would earn.

Front 11

Which of the following is a feature of a certificate of deposit (CD)?

Back 11

Funds deposited in a CD are held for a certain length of time.

Front 12

Which of the following is a feature of a money market deposit account?

Back 12

Tiered interest rates

Front 13

Harris is concerned about the effects of inflation on his investment returns. Which statement best describes inflation?

Back 13

The rise in the general level of prices

Front 14

The most common relationship between risk and return in investing can be stated as:

Back 14

higher risk indicates higher return

Front 15

Elliot's stock broker is suggesting that he consider investing in a diversified portfolio. A diversified portfolio is desirable because it:

Back 15

decreases risk by investing money in a variety of investment tools

Front 16

Which of the following is not true in regards to investing in stock?

Back 16

A stockholder will always receive a profit when the stock is sold.

Front 17

Connor wants to purchase stocks with the money he received from his tax return. Who would he contact to make the transaction?

Back 17

A brokerage fir,

Front 18

Which statement is TRUE of mutual funds?

Back 18

Mutual funds are diversified investments

Front 19

A bond is :

Back 19

a type of debt that a company issues to investors for a specified period of time

Front 20

Alisa is looking for an investment that is structured to have tax benefits. She should look for information on:

Back 20

Tax-advantaged investments

Front 21

It is best to have the rate of return on an investment____ than the rate of inflation.

Back 21

Higher, to maintain purchasing power

Front 22

Which of the following statements is true in regards to paying taxes on investments?

Back 22

Taxes are often owed on profits generated from investments.