NGPF-Investing Unit: Questions With Verified Answers
investing - answer-The process of setting money aside to increase wealth over time for long-term
financial goals such as retirement
savings - answer-money put aside for future use; growing your money is not the top objective
compound interest - answer-interest earned on both the principal amount and any interest already
earned
simple interest - answer-interest paid on the principal alone
reasons to put money in a savings account - answer-low risk
emergency fund
tips for first time investors - answer-keep investments diverse
don't be too risky
keep money invested for a long period of time
diversity - answer-variety
stock exchange - answer-a market for buying and selling stock
two ways to profit from owning stocks - answer-capital gains
dividends
capital gains - answer-The positive difference between the purchase price of a stock and its sale price.
dividends - answer-payments of cash from a corporation to its stockholders
, NGPF-Investing Unit: Questions With Verified Answers
401(k) - answer-A retirement savings plan offered by employers with tax benefits and possible employer
matching.
Bear Market - answer-A period when stock prices fall, often signaling a weak economy.
Bond - answer-A loan made to a company or government, repaid with interest.
Bond Fund - answer-A pool of bonds managed as a single investment.
Bull Market - answer-A period when stock prices rise, often signaling a strong economy.
Compound Interest - answer-Interest that builds upon itself, accelerating investment growth.
Corporate Bond - answer-A bond issued by a company to raise capital.
Default Risk - answer-The possibility that a borrower won't repay a bond or loan.
Diversification - answer-Reducing investment risk by spreading money across different assets.
Dividend - answer-A company's profit paid to shareholders, usually as cash or additional shares.
Employer Match - answer-The amount an employer contributes to an employee's 401(k), usually
matching a percentage of their contribution.
Face Value - answer-The original value of a bond, repaid at maturity.
Inflation - answer-The rise in prices over time, reducing money's purchasing power.
Interest Rate - answer-The percentage charged for borrowing or earned on an investment.
investing - answer-The process of setting money aside to increase wealth over time for long-term
financial goals such as retirement
savings - answer-money put aside for future use; growing your money is not the top objective
compound interest - answer-interest earned on both the principal amount and any interest already
earned
simple interest - answer-interest paid on the principal alone
reasons to put money in a savings account - answer-low risk
emergency fund
tips for first time investors - answer-keep investments diverse
don't be too risky
keep money invested for a long period of time
diversity - answer-variety
stock exchange - answer-a market for buying and selling stock
two ways to profit from owning stocks - answer-capital gains
dividends
capital gains - answer-The positive difference between the purchase price of a stock and its sale price.
dividends - answer-payments of cash from a corporation to its stockholders
, NGPF-Investing Unit: Questions With Verified Answers
401(k) - answer-A retirement savings plan offered by employers with tax benefits and possible employer
matching.
Bear Market - answer-A period when stock prices fall, often signaling a weak economy.
Bond - answer-A loan made to a company or government, repaid with interest.
Bond Fund - answer-A pool of bonds managed as a single investment.
Bull Market - answer-A period when stock prices rise, often signaling a strong economy.
Compound Interest - answer-Interest that builds upon itself, accelerating investment growth.
Corporate Bond - answer-A bond issued by a company to raise capital.
Default Risk - answer-The possibility that a borrower won't repay a bond or loan.
Diversification - answer-Reducing investment risk by spreading money across different assets.
Dividend - answer-A company's profit paid to shareholders, usually as cash or additional shares.
Employer Match - answer-The amount an employer contributes to an employee's 401(k), usually
matching a percentage of their contribution.
Face Value - answer-The original value of a bond, repaid at maturity.
Inflation - answer-The rise in prices over time, reducing money's purchasing power.
Interest Rate - answer-The percentage charged for borrowing or earned on an investment.
