FIN 370 - Final Exam – WVU || with 100% Accurate Solutions.

Assessment correct answers Choosing Investments (real estate, stocks, etc.) "We are assessing different investment options." Idemnification correct answers Ensuring a loss does not adversely affect stability. (Indemnification is NOT about being made whole in a loss) Allocation correct answers WHERE to invest (think about diversification). While, assessment was about choosing the type of investment, allocation is more like choosing HOW MUCH we invest in each type of investment - diversifying! Routine correct answers "Just do it over and over again" (Being Consistent!) Even if you aren't a great investor, if you have _________, your investments are more likely to come out ahead. (i.e. be successful) correct answers Routine (being Consistent!) Savings correct answers Our "cushion" or "safety net" which helps protect us against us liquidity risks. (i.e. needing money NOW and FAST) Whole Life Insurance correct answers Consistent growth, has a moderate growth rate, and is NOT tied to the capital markets, which helps protect against systemic risk. (i.e. I want guaranteed growth outside of the capital markets) Mutual Funds correct answers Improved growth potential while promoting diversity, which helps protect from idiosyncratic risk. (i.e. I want to invest in stocks but don't want my investment to crash because I invested in only one thing - I want DIVERSITY) Stocks correct answers MOST growth potential but also carry the MOST risk. (i.e. I want immense growth and I don't care if I lose this money in this one investment.) Holdings value correct answers Value of your stock investments at a point in time. (Changes all the time, does not become a true value until you sell your money) BTW do not sell when the market is down. Subsidized Loan correct answers Subsidized by the government - the interest is paid by the government while you are in school. Unsubsidized correct answers Interest accrues, there is no subsidization to offset any interest costs. (Subsidized loans are better :D ) Forbearance correct answers Payments are due but on pause. (i.e. you lost your job and you requested your payments to be paused, but the interest is still accruing... this is not a good thing. It might help you if you simply cannot make any payments.)