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5 Written questions

5 Matching questions

  1. annuity
  2. risk return ratio
  3. share
  4. bond
  5. liquidity
  1. a debt instrument where an issuer such as a corporation, municipality or government agency owes you money; a form of I.O.U.; the issuer makes regular interest payments on the bond and promises to pay back or redeem the face value of the bond at a specified point in the future (the maturity date).
  2. b contract sold by an insurance company, designed to provide payments to the holder at specified intervals, usually after retirement; the holder is taxed at the time of distribution or withdrawal, making this a tax-deferred arrangement.
  3. c piece of ownership in a company or mutual fund.
  4. d relationship of substantial reward in comparison to the amount of risk taken.
  5. e quality of an asset that permits it to be converted quickly into cash without loss of value; availability of money; when there is more liquidity, there is typically less return.

5 Multiple choice questions

  1. a term used to designate all contracts covering the sale of financial instruments or physical commodities for future delivery on a commodity exchange.
  2. funds comprised of large, well-established companies.
  3. degree of uncertainty of return on an asset; in business, the likelihood of loss or reduced profit.
  4. account or arrangement in which one would put their money for long-term growth; should not be withdrawn for a suggested minimum of five years.
  5. purchasing risky investments that present the possibility of large profits, but also pose a higher-than-average possibility of loss.

5 True/False questions

  1. money marketmutual fund that seeks to maintain a stable share price and to earn current income by investing in interest-bearing instruments with short-term (usually 90 days or less) maturities.


  2. rental real estatebuying real estate to rent out as an investment.


  3. international stock mutual fundfund that buys stock in medium-sized companies that have experienced some growth and are still expanding; also called a mid-cap fund.


  4. fixed annuitytype of annuity that guarantees a certain rate of return; see annuity.


  5. small-cap fundmutual fund containing a group of medium-sized companies that are growing.