#1
What does APR stand for in finance?
Annual Profit Rate
Annual Percentage Rate
Average Payment Return
Adjusted Payment Ratio
#2
Which of the following is NOT a type of investment?
Stocks
Bonds
Loans
Mutual Funds
#3
What does ROI stand for in finance?
Return On Investment
Risk Of Inflation
Rate Of Interest
Revenue Over Income
#4
What is the function of a credit score?
To determine interest rates on loans
To provide discounts on purchases
To calculate income tax
To manage investment portfolios
#5
What is the difference between a stock and a bond?
Stocks represent ownership in a company; bonds represent debt
Stocks guarantee fixed returns; bonds offer variable returns
Stocks have lower risk; bonds have higher risk
Stocks have maturity dates; bonds do not
#6
What is the purpose of an emergency fund?
To invest in high-risk assets
To cover unexpected expenses
To fund retirement
To purchase luxury items
#7
What is the purpose of a budget?
To spend money freely
To track income and expenses
To invest in high-risk assets
To avoid paying taxes
#8
What is the purpose of diversification in investing?
To concentrate investments in one asset
To increase risk
To reduce risk
To maximize returns
#9
What is the term for the amount of money borrowed in a loan or put into an investment?
Principal
Interest
Equity
Collateral
#10
What does ETF stand for in finance?
Electronic Transfer Fund
Exchange-Traded Fund
Equity Trading Fee
Expense Tracking Fund
#11
What is the formula to calculate compound interest?
P * r * t
P * (1 + r/n)^(nt)
P * (1 + r)
P + rt
#12
Which of the following is a characteristic of a traditional IRA?
Contributions are tax-deductible
Withdrawals are tax-free in retirement
There are no age limits for contributions
There are income limits for contributions
#13
What is the difference between simple interest and compound interest?
Simple interest is calculated on the initial amount only, while compound interest is calculated on the initial amount and the accumulated interest
Simple interest is compounded annually, while compound interest is compounded monthly
Simple interest is always higher than compound interest
Simple interest is calculated more frequently than compound interest
#14
What is the role of the Federal Reserve in the United States?
To regulate international trade
To set fiscal policy
To oversee monetary policy and regulate the banking system
To manage social security programs
#15
Which of the following is a characteristic of a Roth IRA?
Contributions are tax-deductible
Withdrawals are tax-free in retirement
There are mandatory minimum distributions
Income limits for contributions do not apply
#16
Which of the following is a characteristic of a 401(k) retirement account?
Contributions are not tax-deductible
Withdrawals are not subject to penalties
There are no annual contribution limits
Employers often offer matching contributions
#17
What is a mutual fund?
A savings account with a fixed interest rate
A type of retirement account
A pool of funds collected from many investors to invest in securities
A loan provided by investors to corporations
#18
What is the primary function of an investment portfolio?
To generate a fixed income
To minimize risk
To diversify assets and maximize returns
To provide short-term gains
#19
What is the concept of 'buy low, sell high' often associated with?
Real estate investments
Options trading
Market timing
Value investing