Credit, Savings And Investment

12 Questions | By Ppageegsd | Last updated: Mar 20, 2022 | Total Attempts: 98

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This quiz is designed to assess your applied understanding of introductory concepts.

Questions and Answers

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