All Courses > Stocks > 100
Stocks 102: Make Compound Interest Work for You

Test your knowledge

Choose wisely. There is only one correct answer to each question.

0%
Keep studying!
Review your answers below to learn more.
1.
Interest paid on savings accounts and bonds is generally taxable.
Choose wisely. There is only one correct answer.
True. Interest paid on savings accounts and bonds is generally taxable.
2.
Which of the following is used in the formula for determining compounded interest?
Choose wisely. There is only one correct answer.
All of the above. Principal, rate of return, and time periods are used in the compounding formula.
3.
Reinvesting your dividends helps you compound your earnings because it _______.
Choose wisely. There is only one correct answer.
Builds your investment base. The larger your investment base, the more there is to compound.
4.
The amount of money you invest is called _______.
Choose wisely. There is only one correct answer.
Principal. The invested amount of money is called principal.
5.
Compound interest is _______.
Choose wisely. There is only one correct answer.
Interest paid on both interest earned and principal. Because of the way compound interest works, your earnings grow faster than they would by simple interest alone.