This article was doing the rounds about a week ago:
http://www.theatlantic.com/internat...ial-ignorance-do-you-understand-money/361851/
It outlines 3 very easy multiple choice questions (listed below) on the topic of finance.
Apparently only 30% of Americans achieved a perfect score. The best performing country surveyed was Germany with 53% getting a perfect score. The worst performing was Russia with only 4% getting a perfect score.
Here are the questions:
1. Suppose you had $100 in a savings account and the interest rate was 2 percent per year. After five 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) do not know; refuse to answer.
2. Imagine that the interest rate on your savings account is 1 percent per year and inflation is 2 percent per year. After one year, would you be able to buy
A) more than,
B) exactly the same as, or
C) less than today with the money in this account?;
D) do not know; refuse to answer.
3. 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.”
A) true;
B) false;
C) do not know; refuse to answer.
*********************************************************************************
The answers can be found in the article (although I suspect you know them).
I used to wonder why people selling personal finance information products could make so much money. The information they would sell was extremely basic. I now realize it is because there is a very big need for their products as schools have failed the general population completely.
This is also, unfortunately, why the sidewalk isn't going away anytime soon.
http://www.theatlantic.com/internat...ial-ignorance-do-you-understand-money/361851/
It outlines 3 very easy multiple choice questions (listed below) on the topic of finance.
Apparently only 30% of Americans achieved a perfect score. The best performing country surveyed was Germany with 53% getting a perfect score. The worst performing was Russia with only 4% getting a perfect score.
Here are the questions:
1. Suppose you had $100 in a savings account and the interest rate was 2 percent per year. After five 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) do not know; refuse to answer.
2. Imagine that the interest rate on your savings account is 1 percent per year and inflation is 2 percent per year. After one year, would you be able to buy
A) more than,
B) exactly the same as, or
C) less than today with the money in this account?;
D) do not know; refuse to answer.
3. 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.”
A) true;
B) false;
C) do not know; refuse to answer.
*********************************************************************************
The answers can be found in the article (although I suspect you know them).
I used to wonder why people selling personal finance information products could make so much money. The information they would sell was extremely basic. I now realize it is because there is a very big need for their products as schools have failed the general population completely.
This is also, unfortunately, why the sidewalk isn't going away anytime soon.
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