Financial Literacy Answers

Answers to the three financial literacy questions.

 

1) “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?”
A) More than $102
B) Exactly $102
C) Less than $102
D) Don’t know
E) Refuse to answer

 

2) “Imagine that the interest rate on your savings account was 1% per year and inflation was 2% per year. After 1 year, with the money in this account, would you be able to buy…”
A) More than today
B) Exactly the same as today
C) Less than today
D) Don`t know
E) Refuse to answer

 

3) “Do you think the following statement is true or false?
Buying a single company stock usually provides a safer return than a stock mutual fund.”

A) True
B) False
C) Don`t know
D) Refuse to answer