From: A comparative analysis of the OECD/INFE financial knowledge assessment using the Rasch model
Topic | Question number | Toolkit |
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Time-value of money | QK3a | Now imagine that the <brothers> have to wait for one year to get their share of the $1,000 and inflation stays at <X> percent. In one year’s time will they be able to buy |
Interest paid on a loan | QK4 | You lend $25 to a friend one evening and he gives you $25 back the next day. How much interest has he paid on this loan? |
Interest plus principal | QK5 | Suppose you put $100 into a <no fee, tax free> savings account with a guaranteed interest rate of 2% per year. You don’t make any further payments into this account and you don’t withdraw any money. How much would be in the account at the end of the first year, once the interest payment is made? |
Compound interest | QK6 | and how much would be in the account at the end of five years [add if necessary: remembering there are no fees or tax deductions]? Would it be |
Risk and return | QK7a | An investment with a high return is likely to be high risk |
QK7a (alt) | If someone offers you the chance to make a lot of money it is likely that there is also a chance that you will lose a lot of money | |
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Definition of inflation | QK7b | High inflation means that the cost of living is increasing rapidly |
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Diversification | QK7c | It is usually possible to reduce the risk of investing in the stock market by buying a wide range of stocks and shares |
Q7c (alt) | It is less likely that you will lose all of your money if you save it in more than one place | |
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