Unit 4 Quiz (Part B)

What is a budget?

• A plan for managing income, spending, and saving during a given period of time.

• A group of people who lend money to each other.

• An account at a bank for deposit and withdrawal.

• A card that allows money to be withdrawn directly from the holder's bank account.

This is a group of people who come together in-person to form a circle and decide on the amount for a group loan. Each month, participants contribute the same monthly payment and each month a different participant receives the loan.

• Credit Union

• Lending Circle

• Retail Bank

• Pawn Shop

What is the purpose of a checking account?

• The purpose of a checking account is to manage day-to-day financial transactions.
• The purpose of a checking account is to pay off student loans.
• The purpose of a checking account is to invest in the stock market.
• The purpose of a checking account is to save money for retirement.

Imagine Liam has saved $1,000 in a bank account offering 5% interest each year. After 3 years, Liam has accrued a total earnings of $1,158.00. What is this additional earnings is called?

• Compound Interest

• Principal

• Credit

• Budget

What is a FICO/Credit Score?

• a numerical representation of an individual's creditworthiness based on their credit history and other financial behavior.

• a type of cryptocurrency

• a type of food

• a measure of financial knowledge and fitness

What is the Dow Jones?

• The Dow Jones is a stock market index.
• The Dow Jones is a cryptocurrency.
• The Dow Jones is a clothing brand.
• The Dow Jones is a type of fruit.

What is "collateral" in the context of a loan?

• The total amount of the loan
• An asset offered as security for a loan
• The monthly payment due date
• A type of interest rate

What is a Savings Account primarily used for?

• A high-risk investment option

• A basic interest earning account for daily expenses

• A type of loan from the bank

• A fixed term investment

What does a Certificate of Deposit (CD) guarantee?

• A variable interest rate on a savings account

• A rate of interest on a savings account for a fixed term

• Stock prices to go up

• Stock prices to go down

What is the general relationship between risk and return in investments?

• The higher the risk, the lower the return

• The lower the risk, the higher the return

• The higher the risk, the greater the return or loss

• There is no relationship between risk and return