Question

8 multiple choice 1 point
which of these statements accurately describes fixed expenses in a budget?
○ they are often easy to change, and they usually make a large impact on your budget
○ they are often easy to change, and they usually make a small impact on your budget
○ they are often hard to change, and they usually make a large impact on your budget
○ they are often hard to change, and they usually make a small impact on your budget

9 multiple choice 1 point
which of the following is true about investing?
○ price: the cost of the bond if you were to purchase it in the market at the moment
○ maturity: the recommended age a buyer should be when they purchase a given bond.
○ face value: the value of the bond that will be paid out at the end of the bonds life.
○ coupon rate: the annual interest rate paid to the holder of the bond

Explanation:

Question 8

Fixed expenses in a budget (e.g., rent, mortgage, insurance) are typically hard to change in the short - term. Also, since they are regular and often a significant portion of one's income (like rent for a large apartment), they make a large impact on the budget. So we analyze each option:

• Option 1: Says fixed expenses are easy to change, which is wrong.
• Option 2: Says easy to change (wrong) and small impact (wrong).
• Option 3: Says hard to change and large impact, which matches the nature of fixed expenses.
• Option 4: Says small impact, which is wrong.

We analyze each option about bond - related investment terms:

• Option 1: The price of a bond in the market is not just defined as "the cost of the bond if you were to purchase it in the market at the moment" in a precise investment - theory sense. The market price of a bond is determined by many factors including interest rates, credit risk, etc., and this description is too simplistic.
• Option 2: Maturity of a bond is the time when the bond issuer repays the principal, not the recommended age of the buyer. So this is wrong.
• Option 3: Face value is the amount the bond issuer will pay back at maturity, but the description "the value of the bond that will be paid out at the end of the bond’s life" is a bit simplistic. However, compared to the other wrong options, let's check option 4.
• Option 4: Coupon rate is indeed the annual interest rate paid to the bondholder. This is a standard definition in bond investment.

Answer:

C. They are often hard to change, and they usually make a large impact on your budget

Question 9