Banking — Unit test

Question 1

Which are common types of bonds that are currently issued? Check all that apply.

Question 2

Which best describes what a market index does?

Revolt · Accepted Answer

An index measures market performance.

Question 3

Which statement best describes how an investor makes money off debt?

Revolt · Accepted Answer

An investor makes money by earning interest.

Question 4

Capital appreciation refers to

Revolt · Accepted Answer

the increased value of an asset.

Question 5

Which describes an investor’s primary goal of buying a loan?

Revolt · Accepted Answer

to earn a profit off the interest

Question 6

How do bonds generate income for investors?

Revolt · Accepted Answer

Bonds pay a specified amount to the investor at maturity.

Question 7

best

Revolt · Accepted Answer

They both receive capital to use for growth.

Question 8

Are the buying and selling of stocks centralized activities? Why or why not?

Revolt · Accepted Answer

No, there are many stock markets around the world, and they are independent of one another.

Question 9

Bonds are considered to offer a guaranteed return, as they must be honored by law, but which is still a potential risk that investors face?

Revolt · Accepted Answer

The issuer could go bankrupt.

Question 10

What can be traded in a commodities market?

Revolt · Accepted Answer

oil

Banking — Unit test Answers