A Financial Literacy Quiz

It’s short, and it’s from AEIDeas.

Personal Finance Quiz. There three basic questions are often used to test basic financial literacy.

  • Suppose you had $100 in a savings account and the interest rate was 2% per year. After 5 years, how much do you think you would have in the account if you left the money to grow: more than $102, exactly $102, or less than $102?
  • Imagine that the interest rate on your savings account was 1% per year and inflation was 2% per year. After 1 year, would you be able to buy more than, exactly the same as, or less than today with the money in this account?
  • Do you think that the following statement is true or false? “Buying a single company stock usually provides a safer return than a stock mutual fund.”

Only 27% of young adults could answer all three questions correctly.

Answers at the second link.

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