This quiz works best with JavaScript enabled. Home > Saving > Investing > Saving And Investing – Quiz 2 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Saving And Investing Quiz 2 (20 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. Retirement investment taken out after taxes (net income) but withdrawn w/o tax after age 59.5 A) Traditional IRA. B) Municipal Bond. C) 403(b). D) Roth IRA. Show Answer Correct Answer: D) Roth IRA. 2. What is compound interest? A) The interest earned on the principal of an investment. B) The interest earned on a mutual fund. C) The interest earned on a loan. D) The interest earned on both the principal and interest of an investment or savings account. Show Answer Correct Answer: D) The interest earned on both the principal and interest of an investment or savings account. 3. The higher the risk, the higher the potential for greater return (vise versa) A) Maturity Date. B) Shareholder. C) Liquidity. D) Trade off. Show Answer Correct Answer: D) Trade off. 4. When you complete a task yourself rather than paying someone else A) Do it yourself. B) Pay yourself first. C) Saving. D) Interest. Show Answer Correct Answer: A) Do it yourself. 5. Three factors that affect saving money are A) Amount, interest and credit. B) Amount, interest and time. C) Amount, stock and time. D) Interest, stocks and time. Show Answer Correct Answer: B) Amount, interest and time. 6. The percentage rate that is used when calculating the interest (money) paid on a savings, money market, or investment account. A) Rule of 72. B) Interest rate. C) Simple Interest. D) Rate of Return. Show Answer Correct Answer: B) Interest rate. 7. Rule that describes how much you should spend on needs (expenses), wants, and savings. A) 50-10-40. B) 70-20-10. C) 50-30-20. D) 80-10-10. Show Answer Correct Answer: C) 50-30-20. 8. What do IRA's, Roth IRAs, 401ks and 403b all have in common? A) All are combination codes on bank vaults. B) All are long-term savings plan for retirement. C) All are checking accounts that you sign up for at local bank. D) All are short-term savings plans. Show Answer Correct Answer: B) All are long-term savings plan for retirement. 9. Which statement best describes why it is important to choose liquid assets for saving money? A) To provide easily accessible money in case of an emergency. B) To increase wealth. C) To pay for monthly bills. D) To take advantage of unplanned purchase opportunities. Show Answer Correct Answer: A) To provide easily accessible money in case of an emergency. 10. When an asset is described as liquid, it means A) Its value changes all the time. B) You need extra time to get your money. C) It's cash or easy to turn into cash. D) It's easy to figure out its value. Show Answer Correct Answer: C) It's cash or easy to turn into cash. 11. Money available at the present time (today) is worth more than the same amount if received in the future A) Time value of money. B) Trade-off. C) Consumption. D) Interest. Show Answer Correct Answer: A) Time value of money. 12. ..... is interest paid on interest previously earned. A) Emergency fund. B) Interest account. C) Growing interest. D) Compound interest. Show Answer Correct Answer: D) Compound interest. 13. This is the idea that you don't want to have "All your eggs in one basket." A) Spreading risk. B) Easter agenda. C) Safe investing. D) Diversification. Show Answer Correct Answer: D) Diversification. 14. Why should you put aside money as savings? A) To contribute to national economic growth. B) To help you reach important personal goals. C) To provide you with a safety net during hard times. D) All of the above. Show Answer Correct Answer: D) All of the above. 15. Interest earned on interest gained is ..... A) Compound interest. B) Simple interest. C) Principal. D) A dividend. Show Answer Correct Answer: A) Compound interest. 16. A distribution of a portion of a company's earnings A) Interest. B) Earnings. C) Profit. D) Dividends. Show Answer Correct Answer: D) Dividends. 17. Which of the followings is recommended to raise financing for a specific activity A) Equity. B) Debt. C) Loans. D) Bonds. Show Answer Correct Answer: D) Bonds. 18. When the economy is bad ..... A) Dog market. B) Bear market. C) Bull market. D) Pig market. Show Answer Correct Answer: B) Bear market. 19. The total value of everything you own plus your savings and investments is your A) Salary. B) Income. C) Wealth. D) None of above. Show Answer Correct Answer: C) Wealth. 20. Johnny is buying a new truck. Which loan would be best for him to take out? A) Commercial Loan. B) Consumer Loan. C) Mortgage Loan. D) Short-Length Loan. Show Answer Correct Answer: B) Consumer Loan. ← PreviousNext →Related QuizzesSaving QuizzesSaving And Investing Quiz 1Saving And Investing Quiz 3Saving And Investing Quiz 4Saving And Investing Quiz 5Saving And Investing Quiz 6Saving And Investing Quiz 7Saving And Investing Quiz 8Saving And Investing Quiz 9Saving And Investing Quiz 10 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books