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Economics 💸 > Quiz > Flashcards

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(78 cards)

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1
Q

What, at a minimum, is the #1 goal of retirement investments?

A

Outpace inflation

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2
Q

What does SEC stand for?

A

Securities Exchange Commission

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3
Q

Which of the following is true about the stock market?

A

It’s volatile

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4
Q

Which of the following most Mutual Fund likely has the highest risk:

A

Aggressive Growth

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5
Q

One advantage to a mutual fund is that it gives you automatic

A

Diversification

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6
Q

Which of the following would normally pay a dividend?

A

Income fund

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7
Q

Which of the following is not a US Stock Exchange

A

NIKKEI

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8
Q

Which of the following is not normally taken out of a paycheck?

A

YAPE

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9
Q

What is the S &P 500?

A

Tracks top 500 companies

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10
Q

What is the Dow Jones Industrial Average (DOW)?

A

Top 30 companies (largest companies)

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11
Q

True or False : JP Morgan Chase loves Bitcoins and wants to promote Bitcoins

A

False

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12
Q

True or False : JP Morgan Chase loves Blockchain technology and wants to use it

A

True

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13
Q

According to our class project on investing, a company who has a Market Cap of 1B would be which of the following:

A

Small Cap

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14
Q

According to our class project on investing, which of the following would be considered a Mid-Cap stock:

A

A stock with 8B capitalization

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15
Q

Not an employer plan and contributions are tax deductible

A

Traditional IRA

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16
Q

Not an employer plan and contributions are not tax deductible

A

Roth IRA

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17
Q

An employer plan where contributions are taken pre-tax

A

401 (k) plans

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18
Q

The “Rule of 7’s” states that at an investment at 7% interest over 7 years will do what?

A

Double

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19
Q

What is a dividend?

A

Money given back to stockholders from the profits

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20
Q

Do you pay a commission on stock when you buy and sell?

A

Yes

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21
Q

Which of the following is not a Financial Intermediary

A

Uncle Joe

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22
Q

True or False : Certificate of Deposits (CD’s) are FDIC Insured?

A

True

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23
Q

True or False : The main “trick” to stocks is to Buy High and Sell Low

A

False

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24
Q

Bitcoin is a type of crypto

A

Currency

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25
The technology that makes Bitcoin secure is called Block
Chain
26
Excluding IPO's, when you buy stock, you're buying it from?
Another individual
27
What is an IPO
Initial Public Offering
28
Given an example of diversification
Instead of putting $500 into one area, place $100 in five or $200 in two and $100 in one, that way, you can diversify ones portfolio
29
Do mutual funds give automatic diversification?
Yes
30
If I need more money to pay my bills, I have several options. Name the main three different ways we learned in class
Borrow Work harder Sell assets
31
We learned about risk with our investments. name two of the four we discussed
Inflation | Time
32
The greater the risk the greater the
Potential reward
33
As the rule of thumb, how much should we have in our Emergency Savings Fund?
Enough to pay three to six months worth
34
Out of the following, which is typically your most active and central account
Checking
35
Two major companies rate Bonds name them
Moody's | Standard and Poor's (S&P's)
36
What is a "Muni"
Municipal bond, a bond in a local government
37
Give another name for a bond
Loan
38
Stock and bond trades are regulated by the SEC. What does SEC stand for?
security exchange commission
39
Can corporations issue bonds?
Yes
40
If a corporation has Moody's rating of B, will they pay a higher or lower coupon rate than a corporation with a rating of AAA?
Higher coupon rate
41
What is coupon rate
The interest a company or person pays for a bond
42
What is maturity
The time that the money is due
43
If Amazon needs to raise money and decides on bonds, would they be the bond issuer or the bond holder?
Bond issuer
44
We mentioned two stock exchanges in class. Name one
New York Stock Exchange
45
If a corporation goes bankrupt which of the following would be more likely to see at least of their investment returned
Bond holder
46
Which of the following is not a financial asset
Financial intermediaries
47
What is the main difference between a finance company and a bank
A finance company does not have savings accounts
48
True or False: The main purpose of life insurance is to provide financial protection for the family or other beneficiary of the uninsured
True
49
True or False: A pension is guaranteed no matter what job you work in, if you work at least 20 years
False
50
Define diversification
Splitting up your investments
51
Mutual funds:
Pool the money of investors together and invest in different assets
52
Define liquidity
Being able to turn money into cash
53
Complete the sentence: The higher the risk,
The higher the potential reward
54
Give one example of a financial intermediary
Banks
55
Your book mentions four types of risk. Name one
Inflation
56
Mr. Maddox believes Blockchain might be a better long-term investment than cryptocurrency
Technology is worth what is in cryptocurrency cryptocurrency is a fad
57
Bear market
A situation where stock market prices decline steadily over a relatively long period of time
58
Bond
A contract issued by a corporation promising to repay borrowed money, plus interest, on a fixed schedule
59
Bull market
A situation where stock market prices rise steadily over a relatively long period of time
60
CD
Form of time deposits offered by banks
61
Common stock
A share of ownership in a corporation that gives holders voting rights and a share of the profits
62
Coupon rate
The interest rate a bondholder receives every year until a bond is mature
63
Diversification
The practice of distributing investments among different financial assets to maximize return and limit rate
64
Dividends
Payments which are a share of a corporations profit that are paid to shareholders
65
DOW
A stock index that measures the performance of thirty major companies
66
Financial intermediary
A financial institution that collects funds from savers and then invests these funds in loans and other financial investments
67
Future
A contract to buy or sell a stock at a specific date on a present price
68
Maturity
The date when the bond is due to be repaid
69
Money market
The market for buying and selling short term financial assets
70
Municipal bonds
Bonds issued by state and local governments
71
Mutual fund
A pool of money managed by an investment company that gathers money from individual investors which is then used to purchase a wide range of financial assets
72
NASDAQ
Second largest exchange in the world, a majority of companies on this exchange are involved in technology
73
NYSE
The oldest and largest of stock exchanges in the United States
74
Par Value
The amount a bond issuer must pay the buyer at maturity
75
Return
The actual profit or loss made on an investment
76
Risk
The possibility for loss on investment
77
Savings
The money one has saved especially through a bank or official scheme
78
Stock exchange
A secondary market where securities are bought and sold

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