Wellness Center [Financial Literacy Resources]

Answer 4 out of 5 questions correctly to earn a reward

Question 1

Why is it called the Rule of 72 over the Rule of 69.3?

Because 72 is more accurate for a wider range of interest rates.

Because 72 represents the exact time it takes for money to double.

Because 72 has a more appealing sound to it than 69.3.

Because it is easier to work with, as 72 is readily divisible by more numbers.

Question 2

What is the difference between simple and compound interest?

Simple interest compounds daily while compound interest is calculated annually.

Simple interest is calculated annually on the deposit amount, whereas compound interest is added to the principal to form a new base for the next interest calculation.

Compound interest is only calculated on loans while simple interest is for savings accounts.

Simple interest is added to the principal for the next interest calculation, whereas compound interest is calculated annually on the deposit amount.

Question 3

What is the Rule of 72 used for in investing?

Estimating how long it will take for an investment to double at a given interest rate.

Estimating the total return on investment after 72 years.

Determining the exact amount of time it takes for money to double.

Calculating the specific interest rate needed for an investment to triple.

Question 4

What happens if you decide to withdraw your money from a CD or share certificate before it matures?

You'll be able to withdraw without any penalties.

You'll receive an extra interest bonus.

Your interest rate will double.

You'll face penalties and fees.

Question 5

What is a key aspect to consider when managing your investment fees?

Disregard small charges as they have no impact over the long term.

Ensure that the investment fees are high to yield higher returns.

Opt for investments with higher fees as they often outperform those with lower associated fees.

Review and minimize charges whenever possible.

Reward Quiz