Stocks & Investments
What is a stock?
A share of a company's assets.
Name one difference between a checking account and a savings account.
Checking = Used for frequent spending. Savings = Used to save and earn interest.
The Federal Reserve Act.
What does DeFi stand for?
Decentralized Finance.
What makes a high-yield savings account "high-yield"?
It pays a higher interest rate than a traditional savings account.
Which type of stock gives voting rights---common or preferred?
Common stock.
What does FDIC stand for?
Federal Deposit Insurance Corporation.
What major act created the FDIC?
What technology stores transaction records in a peer-to-peer network?
Blockchain.
What does CD stand for in banking?
Certificate of Deposit.
What is it called when you sell a stock for more than you paid?
A capital gain.
What's the difference between a bank and a credit union?
Banks are for-profit; credit unions are not-for-profit.
What crisis was triggered by the collapse of the housing market and subprime mortgages?
The 2008 Financial Crisis.
What is a smart contract?
An automatic computer program that executes financial actions.
What is the difference between a Traditional IRA and a Roth IRA?
Traditional = Pre-tax contributions; Roth = Post-tax contributions.
What is short-selling?
Betting that a stock's price will go down.
What does "unbanked" mean?
People who do not use a bank or financial institution?
What was one purpose of the Federal Reserve Act?
To stabilize the money supply and prevent bank panics.
Name one risk of DeFi investing.
Bugs, scams, sending money to the wrong address, volatility (any one).
Define: Deductible.
The amount you pay before insurance starts to cover costs.
Are bonds more or less risky than stocks, and why?
Less risky; they provide fixed interest and repayment at maturity.
List two required parts of a written check.
Payee, date, numeric amount, written amount, memo, signature (any two).
What major issue did the 2008 crisis highlight about the financial system?
Systematic risk and lack of regulatory oversight.
A crypto wallet, cryptocurrency, and an app like Uniswap (any two).
What is the purpose of estate planning?
To organize assets so they are managed and distributed properly after death or incapacity.