Credit, Savings And Investment
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This quiz is designed to assess your applied understanding of introductory concepts.
- 1.A mortgage is an example of a closed-end credit.
- A.
True
- B.
False
- 2.Conservative, risk-adverse investors are attracted to small-cap stocks.
- A.
True
- B.
False
- 3.A bear market occurs when investors are pessimistic about the economy.
- A.
True
- B.
False
- 4.A portfolio that includes stocks invested in one (1) sector of the market is considered to be diversified.
- A.
True
- B.
False
- 5.Stocks represent ownership in a company.
- A.
True
- B.
False
- 6.BONUS: _________ are similar to mutual funds. They invest in a sector of the market or the stocks that make up an index, such as the Nasdaq100.
- A.
Index funds
- B.
Exchange Traded Funds (ETFs)
- C.
Commodities
- 7.The trade-off made by making one choice instead of another is commonly referred to as a(n)
- A.
Trade decision
- B.
Opportunity cost
- C.
Personal choice
- 8.Credit cards allow the user to _________
- A.
Spend only the amount in your account
- B.
Borrow money for a short term
- C.
Transfer money between accounts on-line
- 9.Which of the "five C's of credit" require that a peson's assets exceed his or her liabilities?
- A.
Capacity
- B.
Capital
- C.
Collateral
- 10.The par value of a bond represents its ____________.
- A.
Comparative value to other bonds issued by the same entity
- B.
Total value, calculated by adding principal and interest
- C.
Face value
- D.
Discount rate
- 11.The P/E ratio for a stock represents________________.
- A.
The price an investor is willing to pay for $1 worth of earnings.
- B.
The priceof a stock in relation to the earnings per share
- C.
Both A and B
- 12.A FICO score is a measure of _____________.
- A.
A potential borrower's credit worthiness
- B.
The likelihood an individual will repay a loan
- C.
An individual's assets
- D.
Both A and B
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