Question

iece of ownership in a company, mutual fund or other investment
Share
401k
You should start investing as soon as you have your college education funded.
False
True
Money that is invested, either tax deferred or tax free, within a retirement plan
Dividend
Tax-favored dollars
Saving and investing have nothing to do with the amount of money you make.
False
True
A mutual fund portfolio that is properly diversified will have all investment dollars located in just one of four different classes of financial assets.
False
True
Which of the following statements about the stock market is false?
Formed in 1792, the New York Stock Exchange (NYSE) is the smallest organized stock exchange in the United States.
The Dow Jones Industrial Average is one measure of the stock market.
The stock market is a generic term that encompasses the trading of securities.
The terms bull market and bear market describe upward and downward market trends.
You can start investing with a small amount of money.
False
True
The benefit of diversification in your investments is:
Reduced risk
Reduced tax liability
Increased risk
Increased return
In some cases, employers will match the employee contribution, but you should fund your plan whether your company matches or not. This statement refers to:
Roth IRA
401(k)
Bond funds
Single stocks
Which of the following is a good investment option?
Futures
Mutual funds
Viaticals
Gold
Federal agency responsible for collecting taxes and for the interpretation and enforcement of the Internal Revenue Code
Federal Deposit Insurance Corporation
Internal Revenue Service
When buying and selling investments, you should not:
Learn the different types of investments
Set your investment goals and consider a time frame
Understand basic investment strategies and identify ones that will help you reach your goals
Switch your investment strategy often, based on market conditions
Securities that represent part ownership or equity in a corporation
Bonds
Stocks
Savings accounts and money-market accounts are most appropriate for:
Savings accounts and money-market accounts should be avoided since they carry high risk
Emergency funds and short-term goals
Earning a high rate of return
Long-term investments like retirement
To ensure that some of your retirement savings will not be subject to income tax upon withdrawal, you would contribute to:
A traditional IRA
An annuity
A Roth IRA
A 401(k)
A retirement plan found in nonprofit organizations such as churches, hospitals and schools.
403(b)
401(k)
457
GIC
Company Xʹs board of directors has decided to issue a portion of its earnings to its shareholders. If you own stock in Company X, you can expect to receive a(n):
Yield
Buy-out
Dividend
Investment
Relationship of substantial reward compared to the amount of risk taken
Investment strategy
Risk-return ratio

Answer 1

1. Share
2. True
3. Tax-favored dollars
4. False
5. False
6. "Formed in 1792, the New York Stock Exchange (NYSE) is the smallest organized stock exchange in the United States." (this statement is false)
7. True
8. Reduced risk
9. 401(k)
10. Mutual funds
11. Internal Revenue Service
12. Switch your investment strategy often, based on market conditions
13. Stocks
14. Emergency funds and short-term goals
15. A Roth IRA
16. 403(b)
17. Dividend
18. Risk-return ratio