The Fundamentals of Investing Test
Study online at https://quizlet.com/_nhqek
1. Stocks: a share of ownership in a company
2. Bonds: basically a loan - except in this case you're the lender
3. Mutual Funds: a collection of investments that you buy as a single package,
rather than purchasing individual stocks, bonds, and other investments yourself
4. Index Funds: ...
5. Real Estate: ...
6. Speculative Investments: ...
7. The possibility that an investment will fail to pay the expected return or fail
to pay a return at all: Investment Risk
8. The rise in the general level of prices: Inflation
9. The uncertainty regarding the outcome of a situation of event: Risk
10. The danger that money won't be worth as much in the future as it is
today: Inflation Risk
11. Provide three examples of how the purpose of investing is different than
the purpose of saving: ...
12. Order the following from high risk to low risk :
bonds, stock and real estate, speculative, and mutual funds and index funds-
: Highest
#1
#2
#3
#4
Lowest
13. Interest
(Type of Return): the fee someone pays to be able to borrow money
14. Dividends
(Type of Return): ...
15. Rents
(Type of Return): ...
16. Capital Gains
(Type of Return): the amount of money you gain from an investment
17. Describe the concept of investment philosophy and how it relates to
portfolio diversification: ...
18. What is the difference between a full-service brokerage firm and a discount
brokerage firm?: ...
19. What are two questions you should ask before hiring a brokerage firm?: ...
20. What are two benefits of a tax-advantage account? What is a trade-off?: ...
21. (T/F) Taxes must be paid on ALL investment profits in the year the unearned
income is recieved: False
1/2
Study online at https://quizlet.com/_nhqek
1. Stocks: a share of ownership in a company
2. Bonds: basically a loan - except in this case you're the lender
3. Mutual Funds: a collection of investments that you buy as a single package,
rather than purchasing individual stocks, bonds, and other investments yourself
4. Index Funds: ...
5. Real Estate: ...
6. Speculative Investments: ...
7. The possibility that an investment will fail to pay the expected return or fail
to pay a return at all: Investment Risk
8. The rise in the general level of prices: Inflation
9. The uncertainty regarding the outcome of a situation of event: Risk
10. The danger that money won't be worth as much in the future as it is
today: Inflation Risk
11. Provide three examples of how the purpose of investing is different than
the purpose of saving: ...
12. Order the following from high risk to low risk :
bonds, stock and real estate, speculative, and mutual funds and index funds-
: Highest
#1
#2
#3
#4
Lowest
13. Interest
(Type of Return): the fee someone pays to be able to borrow money
14. Dividends
(Type of Return): ...
15. Rents
(Type of Return): ...
16. Capital Gains
(Type of Return): the amount of money you gain from an investment
17. Describe the concept of investment philosophy and how it relates to
portfolio diversification: ...
18. What is the difference between a full-service brokerage firm and a discount
brokerage firm?: ...
19. What are two questions you should ask before hiring a brokerage firm?: ...
20. What are two benefits of a tax-advantage account? What is a trade-off?: ...
21. (T/F) Taxes must be paid on ALL investment profits in the year the unearned
income is recieved: False
1/2
