AnswersISP ONLY Economics S5000XXInvesting and Financial Markets

Investing and Financial Markets — Unit test Answers

59 verified answers4 views
141
Free Preview

Buying a new car can create a financial challenge because

A
car insurance rates will decrease over time.
B
car payments must become part of the budget.
C
car insurance rates will be higher than renter’s insurance.
D
car payments are likely to exceed available income.
142
Free Preview

In what way does a 401(k) differ from an individual retirement account (IRA)?

A
A 401(k) is created through an individual’s employer.
B
A 401(k) can be created by individuals who deposit money.
C
A 401(k) allows consumers to contribute before taxes.
D
A 401(k) is a good long-term investment strategy.
143

Which statements apply to leasing a car? Check all that apply.

A
The car may be driven as much as needed.
B
Payments are generally higher than buying.
C
There are mileage restrictions on the car.
D
You must return the car after the lease ends.
E
There are penalties for ending the lease early.
F
You can sell the car to someone else after the lease ends.
144

Since stocks can be traded online, which purpose is best served by markets?

A
Markets regulate transactions.
B
Markets are where the trades actually occur.
C
Markets sell the assets to be traded.
D
Markets ensure that the transactions are secure.
145

Why do prices increase when demand for a product is high?

A
Companies know they can make more money by selling fewer products at higher prices.
B
Companies know that people will be willing to spend more to get an in-demand product.
C
Companies take advantage of the demand to make people spend more money on excess products.
D
Companies know they can stop production and still make money on sales.
146

Which best describes how an investor makes money from an equity investment?

A
by earning interest
B
by selling the asset for a profit
C
by raising capital
D
by growing the asset
147

Which fixed expense would be most difficult to change if money is needed for car payments?

A
rent
B
electricity
C
cable
D
Internet
148

[BLANK]

A
spending
B
saving
C
paying
149

Look at the table below showing an example of a checkbook ledger.

Question illustration
A
$624.50
B
$704.50
C
$755.50
D
$784.50
150

When making a decision about housing, the first step should be

A
visiting different housing locations.
B
gathering information on available housing.
C
analyzing the availability of housing loans.
D
comparing the cost of housing alternatives.
151

What might convince an investor to buy stock or mutual funds?

A
belief that a company has just reached its peak popularity
B
news that a stock's price has recently increased significantly
C
belief that a small number of investors have bought the stock so far
D
news that a company is about to release a promising product
152

Which of these investments may be long term? Choose four answers.

A
savings accounts
B
mutual funds
C
bonds
D
retirement funds
E
commodities

Did you find these answers helpful?

More from this Course

Quiz
25 verified answers

Unit Test

Quiz
21 verified answers

Unit Test

Quiz
27 verified answers

Unit Test