19.5 other investments

Question 1

the value of collectibles is most influenced by:

• the current tax rate on investments
• government regulations of the market
• the futures market for commodities
• interested buyers and potential sellers

Answer 1

interested buyers and potential sellers

Question 2

What are some agricultural products traded on commodity exchanges?

Answer 2

• corn
• soybeans
• wheat

Question 3

____ are bought and sold on exchanges similar to stock exchanges, buyers and sellers are represented by traders on the exchanges

Answer 3

commodities are bought and sold on exchanges similar to stock exchanges

Question 4

agreements to buy or sell an amount of a commodity at a specified price in the future

Answer 4

futures contract

Question 5

What is an advantage of collectibles?

Answer 5

the personal pleasure of buying, collecting, storing, arranging and displaying what is collected

Question 6

an investment with an unusually high risk

Answer 6

speculative investment

Question 7

items of personal interest to collectors that can increase in value in the future

Answer 7

collectibles

Question 8

using your savings to earn more money

Answer 8

investing

Question 9

what is one of the best known commodities exchanges?

Answer 9

Chicago Board of Trade (CBOT)

Question 10

the percentage of money earned on your savings or investment over a year, also called the rate of return

Answer 10

yield

Question 11

the ease with which an investment can be changed into cash without losing its value

Answer 11

liquidity

Question 12

land and anything that is attached to it

Answer 12

real estate

Question 13

include grain, livestock, and precious metals

Answer 13

commodities

Question 14

What types of commodities are commonly used with futures contracts?

Answer 14

• agricultural commodities
• currencies commodities

Question 15

grain, livestock, and precious metals

Answer 15

commodities

Question 16

the price at which a share of stock can be bought and sold in the stock market

Answer 16

market value

Question 17

What affects the prices of precious metals?

Answer 17

• economic conditions
• supply and demand

Question 18

investors have traded ___ and ___ on commodity markets for centuries.

Answer 18

investors have traded gold and silver on commodity markets for centuries

Question 19

licensed specialist in the buying and selling of stocks and bonds

Answer 19

stockbroker

Question 20

storage of money for future use

Answer 20

saving

Question 21

____ producers sell their crops in advance of a harvest at what they beleive is a good price, farmers will then know in advance how much they will receive for a crop

Answer 21

Agricultural producers sell their crops in advance of a harvest at what they beleive is a good price, farmers will then know in advance how much they will receive for a crop

Question 22

items of personal interest to collectors that can increase in value in the future

Answer 22

collectibles

Question 23

the difference between the price at which you could currently sell your house and the amount owed on the mortgage

Answer 23

equity

Question 24

bonds issued by local and state governments

Answer 24

municipal bond

Question 25

What are common types of collectibles?

Answer 25

• stamps
• coins
• sport trading cards
• art
• antiques

Question 26

an agreement to buy or sell an amount of a commodity at a specified price in the future

Answer 26

futures contract

Question 27

bonds issued by corporations

Answer 27

corporate bond

Question 28

stock that has first priority in the payment of dividends

Answer 28

preferred stock

Question 29

What currencies are sold on commodities exchange?

Answer 29

• US dollar
• euro
• japanese yen
• treasury bills
• treasury notes

Question 30

investments set up and managed by comanies that receive money from many investors

Answer 30

mutual fund

Question 31

What collectibles tend to be items that an investor can make a considerable profit?

Answer 31

• rare stamps
• coins
• art
• antiques

Question 32

current price quoted for precious metals in the world markets

Answer 32

spot prices

Question 33

business organizations that accommodate the buying and selling of securities

Answer 33

stock exchange

Question 34

What are some precious metals that are traded on commodity markets?

Answer 34

• gold
• silver
• copper
• platinum

Question 35

What are pros and cons of investing in precious metals?

Answer 35

Pros

• protect against currency becoming worthless
• gold could be used for buying goods and services if paper money isn’t accepted

Cons:

• does not earn interest
• only profit if you sell them later at a price higher than what you paid

Question 36

a legal document giving the lender a claim against real estate property

Answer 36

mortgage

Question 37

the amount that your local government determines your property to be worth for tax purposes

Answer 37

assessed value

Question 38

represents general ownership in a corporation and a right to share in its profits

Answer 38

common stock

Question 39

What conditions affect agricultural commodity prices?

Answer 39

• weather
• international trade agreements
• worldwide demand and supply

Question 40

the spot price for gold or silver refers to the:

• interest for borrowing to buy the precious metal
• current market price of the precious metal
• future market price of the precious metal
• global price for the metal set by the world bank

Answer 40

current market price of the precious metal