Personal Finance Fundamentals
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Questions and Answers

What is one of the key aspects of achieving financial well-being?

  • Investing in real estate
  • Purchasing gold
  • Taking out a loan
  • Creating a budget (correct)
  • What is the primary goal of financial planning?

  • To accumulate wealth
  • To reduce expenses
  • To invest in mutual funds
  • To achieve financial well-being (correct)
  • What is the main advantage of saving?

  • Increasing spending power
  • Providing a financial safety net (correct)
  • Earning high returns on investment
  • Reducing debt
  • What is the primary risk associated with inflation?

    <p>Reduced purchasing power</p> Signup and view all the answers

    What is the main benefit of compound interest?

    <p>Accelerated growth of investments</p> Signup and view all the answers

    Real estate investment can provide a steady income stream.

    <p>True</p> Signup and view all the answers

    Inflation reduces the purchasing power of money.

    <p>True</p> Signup and view all the answers

    All mutual funds are classified as debt or equity funds.

    <p>True</p> Signup and view all the answers

    Health insurance only covers medical expenses related to accidents.

    <p>False</p> Signup and view all the answers

    The power of compounding only applies to short-term investments.

    <p>False</p> Signup and view all the answers

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