{

Savings & Invested

Test Review

{Interest

The percentage rate paid on money you have invested/saved…

{6

It is recommended you save __ months of expenses to be more financially secure.

{Certificate of Deposit

This savings tool option makes the highest amount of interest.

{Savings Account

Which savings tool is most liquid?

{Savings

Portion of your income not spent on current expenses…

{Money Market Deposit Account

This savings tool has a minimum deposit requirement, and limits withdrawals…

{Certificate of Deposit

This savings tool has a time requirement with penalties for early withdrawals…

{Return

Profit or Income generated from savings and investing is called _______.

{An Investment

An asset purchased with the goal of providing additional income is called _______.

{Returns & Risk

When comparing savings and investing, investing has the potential for higher ______.

{long

Money you invest is usually used for _____-term goals.

{Investment Risk

The possibility that your investment will fail to produce a return…

{10%

It is recommended that you save ____ of your monthly income.

{Higher

The higher the risk on an investments, the ______ the return.

{a house

An example of a long term investment is ______.

{Bond

This investment is a form of lending money to a company or the government.

{Maturity Date

A specified time in the future when the principal amount an the interest is repaid to the investor.

{Mutual Fund

When you give in investor your money and they invest it in several different types of investments.

{Real Estate

Investment in commercial or residential property.

{Stocks

Purchasing a share of ownership in a company.

{Dividend

When you earn a return on a stock, it is called a _____.

{Stockholder or Shareholder

The owner of stock is called a ______.

{False

If you are a stockholder, you will always receive a dividend.

{Speculative, Real Estate, Commodities

The three highest risk Investments (and are located at the top of the pyramid) are ____, ____, ____.

{Diversify

_________ is when you reduce your investment risk by purchasing different types of investments.

{Largest AmountHighest RateThe longest time

When looking at the time value of money it is best to invest ______ at the _______ for ______.

{Principal X Rate X Time

The equation for Simple Interest is _______.

{Principal(1+Rate)N

(N= Number of times Compounded)

The equation for Compound Interest is _______.

{Save

When looking at whether to save or invest, you should _____ if your trying to plan for an emergency.

{Invest

When looking at whether to save or invest, you should _____ if your trying to plan for your retirement.