5 out of 6

I misread the second question

4. Bond question caught me slippin

5/6, messed up the bonds question

Explanation to questions:
1. Interest rate means they are going to pay you for the percentage of money you have deposited. So after second year you would have 102 in your account, so its def going to be more then 102 after 5 years.

2. Inflation in this case means the percentage of everyday things that got more expensive over a time period (a 100$ in 1950s worth a lot more then today because of inflation). So if inflation is higher then interest rates then you would have less money then you've had.

3. This is a tricky one, I wouldn't expect everyday people to get. Here is an example, you get price of bond of 100 dollars, rates at 1 percent per year, so you are suppose to get 1 dollar per year. If rates raise to 2 percent, in order for you to get the same amount of 1 dollar, the price of the bond need to drop to 50 . This is not how it actually works because you get paid back the original money you put in but yall get the idea. The markets need to make the same bond equally attractive.

4. You have to pay back a sum of money in 15 or 30 years. There will be interest fee for each dollar you didn't pay back, so longer you wait to pay back the more interest. So even you pay more yearly with 15 years, you will pay less interest.

5. Here they weren't clear about what is a mutual fund, but think of a fund like the S&P500 ( a basket of companies) so instead of betting on one company you are betting on a bunch of them. So you are betting on the fact that overall companies are going to do well, instead of betting on one. So in that sense it is safer, as you wouldn't know what is the next tesla or google.

6. This is the most important concept of investing. Which is why you should invest early. Think about it for a min and refresh your 5th grade math.
year 1: 100*1.2 = 120
year 2: 120*1.2 = 144
year 3: 144*1.2 = 172.8
year 4: 172.8*1. = 207.36

It only took 4 years to double your money.
If you were only earning 7% per year ( avg return of S&P500) it would take around 10 years to double your money. That's insane.
Do you see the power of that, its called the power of compound interest, as Einstein said it " compound interest is the most powerful force in the universe"

Please add to @OP

I just b sittin in my car mane.
Took a car nap earlier today.
Back at it.
Finna chill at the house. Create some good s*** mane.

Got all 6

They don't call me Yung Zuckerberg for nothing mate

yeah thats not accounting my guy thats finance

I mean I get why people buy it but come on people on the site is 15-25 years old, please for the love of god don't buy it for the sake of diversity, its really stupid.

I am looking at bonds to how much money it will earn for me. So yea I am only looking at the yield, Im not trading bonds and I dont think yields would fall more so there is litreally no reason to buy a bond. and yes are you kidding me we are the lowest bond yield since WW2. Even buffet is not buying this lol. Like the opportunity risk to buy bonds is just so low right now, I won't do it for yield, not for stability. Rather buy gold for hedge.

Tbh interest and mortgage questions should be the easiest for most

I’m Canadian but still a fintech hardo bro. “Pls fix thx” - warriors stand up.

Also anybody with a f***ing pulse & basic future-value understanding can solve all these

5/6

5/6

5/6, bond question f***ed me up

You’re in control of that

ik

5/6

i technically missed the last question because i counted the first year as the first year you have the bond but not the first year after, so im financially sound but cant read for s***

I got 5 out of 6 right.

Got the bond question wrong because I thought it was no relationship

I got 5 out of 6 too i wasn't sure about the interest rate one i thought they cancelled eachother back to same

Got 3 out of 6 questions wrong, guess I’m a tard

5/6

Missed the last question

dam
are you rich?

pretty basic tbh

Only question I would think would trip up the average user is the bonds/interest question.