Answer the questions below. Submit the exam when you are done.
Jordan is reviewing her financial assets and wants to understand how easily she can access her funds in case of an emergency. She asks her financial advisor which measure tells her how quickly her investments can be turned into cash without losing value.
Which financial term is her advisor most likely referring to?
Victoria recently set aside money in a separate savings account labeled “Emergency Fund.” She wants to be financially prepared for the unexpected.
What is the primary purpose of Victoria’s emergency fund?
Hunter invested $1,000 and discovered that, at an 8% interest rate, his money would double in approximately 9 years. He didn’t use a calculator—just a simple mental shortcut.
What method did Hunter most likely use to figure this out?
Alexa started a job at Scheels, a FOR PROFIT ORGANIZATION, and was offered a retirement plan. What is the name of the retirement plan offered by her employer?
Nick and Kia both invested in their company's 401(k) plan. What statement is true about Nick and Kia investment decision?
What professional could you hire if you would like to purchase stock on the stock market through a brokerage firm?
Jamal is a high school student who wants to start managing his money more wisely. He sets a goal to save up enough money within the next few months to buy a new laptop for school.
Which type of goal is Jamal setting?
Mr. Thompson is preparing to retire next year after working for over 30 years. As he reviews his finances, he considers how his expenses and income might change once he stops working full-time.
Which of the following will most likely happen during Mr. Thompson’s retirement? (Select all answers that apply)
Lena has money invested in a savings account that earns a small amount of interest each year. Recently, she noticed that the prices of groceries, gas, and other everyday items have been rising quickly. Despite earning interest, her money doesn’t seem to stretch as far as it used to.
What is Lena experiencing?
Caleb contributes regularly to his Individual Retirement Account (IRA), which is tax-deferred. He’s trying to understand how this affects his taxes.
What does it mean that Caleb’s IRA is tax-deferred?
Ben has just secured his first job, and has the opportunity to invest in several different types of investments. He has chosen to “spread his assets out over several different investments” to reduce his risk of loss. What concept has he applied?
Wyatt owns stock in a telecommunications company. Recently, he received a payment from the company that represents a share of its profits. He's excited because it's a return on his investment.
What did Wyatt receive?
Todd has an investment portfolio. He has closely examined each of his investments and calculated his return on investment (ROI). What does the ROI tell him about his investments?
Arthur has implemented the “pay yourself first” strategy as part of his budget planning. What is Arthur doing?
Alice has an investment that allows her to have DIVERSIFIED holdings with the ONE INVESTMENT. What type of investment does she have?
Gerald likes to invest in the stock market. His current investments in the stock market have not been performing very well, but he has been able to pick up many stocks for cheap prices. What type of market condition is he experiencing?
He won’t have to pay taxes on the interest or earnings from them
Bella would like to invest in an investment that would yield high earnings. She is not afraid to take risks. Which investment would allow her to earn lots of money, but carry a high risk? (Top of the risk pyramid)
Jane has an investment portfolio. She wants to ensure that it will continue to grow for her retirement. Which of the characteristics should she be sure that her portfolio meets?
Lucy has been dabbling in the stock market since she graduated from college. She hasn’t always had the best returns on her stocks, but lately things have been very profitable and she has made large profits on her stock ventures. What type of financial market is she experiencing lately?
Jorge is a junior in high school. His baseball team has been recognized as the best in the state, which has earned the team a chance to take a trip to visit the Minnesota Twins, and attend some training clinics with the Twins. he will need $2,000 for the trip. His parents are offering to pay for half of the trip, and the school will contribute $500 for the cost of the trip. Jorge will need to come up with the remaining $500. Which of the following assets would be the most liquid?
Ella recently opened an Individual Retirement Account (IRA) and started making regular contributions to it. She wants to make sure she’s planning wisely for her financial future.
What is the main purpose of Ella’s IRA?
Brian is a nurse. He works for a NONPROFIT hospital. As an employee of the hospital, he can contribute to an employer sponsored retirement plan. Which retirement plan would his company be using?
Miska is interested in investing in several stocks. He has downloaded a copy of the annual report from each of the company's websites. What is an annual report?
Evan and Kira file their taxes every year. Which agency has the responsibility of collecting their taxes?
Carlos recently began investing in the stock market. He’s learning about the different ways people can earn money through their stock investments.
Which of the following is one way Carlos could make money from stocks?
Maya recently purchased shares in a publicly held company through the stock market. She now owns a small portion of that company and is excited to see how her investment performs.
What is Maya’s ownership in the company called?
The Thomas Car Wash is a private company but is in the process of becoming a publicly traded company. The owner of the company decided to offer his private company's stock to be publicly traded on the stock market exchange. What is it called when a company offers its stock to the public for the FIRST TIME to be traded on the stock market?
The city of Sioux Falls needs money to build a new baseball stadium. In order to do this, they decide to pursue loans from the citizens. What is this type of debt instrument (loan) issued by a corporation or government called?
Sophia is deciding between two investment options: one offers a high potential return but comes with a greater chance of losing money, while the other is safer but has lower expected returns. She wants to understand how the level of risk affects what she might earn.
What best describes the relationship between investment risk and returns?
Jasmine is deciding between two options for her extra money: putting it in a savings account at her bank or investing it in the stock market. She wants to understand the key differences between these choices.
How does investing in the stock market differ from saving money in a bank account?
Emma is reviewing how her savings grow over time. She learns that her interest earnings are added back to her account balance, which then earns interest itself in the following periods.
Which of the following statements about compound interest is TRUE?
Jamie is deciding how to invest her money. She wonders if it’s better to invest all in one company or to spread her money across different types of investments like stocks, bonds, and real estate.
Why might Jamie choose to diversify her investments?
Liam is exploring different ways to invest his money. He learns about stocks and bonds but wants to understand the key differences between the two.
How is a bond different from a stock?
Sophia is planning for her retirement and is trying to decide between opening a Roth IRA or a Traditional IRA. She wants to understand the key differences to make the best choice.
Which is an important question Sophia should ask when deciding between a Roth IRA and a Traditional IRA?
Sanjana is talking to her younger brother about how people receive income after they retire. She wants to explain what Social Security means in a simple way.
Which of the following descriptions should Sanjana use to explain Social Security?
What is ONE concept from this unit that you believe would help you achieve financial success now and/or in the future? 1. Name the term (1 point) 2. Define the term (1 point) 3. In three to five sentences, explain how this concept will promote your financial stability and health.
(3 points)
Term Ideas:
401(k)
IRA
Diversification
Mutual Fund
Stocks