Untitled Flashcards Set

What is the most fundamental economic problem?

Scarcity

What causes scarcity?

Limited resources to meet unlimited wants/needs

What is the opportunity cost of a 30 year loan?

Less money left in the long term

What are the 2 reasons that people don’t save?

They want instant gratification & it’s easier to use credit

Which type of investment is riskier?

Mutual funds

What is the relationship between risk and reward?

Higher risk leads to higher reward, and lower risk leads to lower reward.

When you are investing, what are 3 factors that you can change?

Interest rate, length of time, amount invested.

What is the difference between the S&P 500 and the NYSE?

S&P 500 is a report of how the top 500 companies are doing, while the NYSE is an actual stock exchange.

Which type of investment has the highest liquidity risk?

Real estate

How many credit scores do you have?

One

When you file an insurance claim, what do you pay first?

Deductible