Do you Actually Understand Money?

Sharksfan said:
80% - I disagree with the credit card one though. It's not as cut and dried as "annual interest rate vs annual fees".

If you are always paying your balance in full the annual fees are frequently more costly than the annual interest rate. You will pay some interest but it's going to be a fraction of what you'd pay if you were carrying a balance.

This is especially true when you are turning over volume on your CC and instead of paying the bill every month you are paying it every week as I've seen a few people here mention. I do this myself.

The interest you'll pay is potentially low; the fees are a fixed cost. They are both important. And if you have a premium/higher end credit card you will be paying annual fees.

So in short - I can see it going both ways.
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you are correct. But for most people the credit card annual fee they pay is probably low ( $100-$300 )? this is way less than what they would pay even with a low balance on the card on interest...
 


cucaloco said:
The question asked "Which type of mortgage would allow a first-time home buyer to qualify for the highest loan amount?

Adjustable rate mortgages are always cheaper than fixed rates mortgages to start. The price can go up or down based on what rates are doing (thus less risk for the owner of the paper). So you can always qualify for a higher loan amount.
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Yeah, owning the paper secured by option ARMs worked out well for bond holders.

The question is stupid. You can get a 100% LTV loan fixed or floating if you are well qualified. That was my point.
 
I botched the short-term/emergency use for money markets.

I don't think I've ever given a thought to the practical use an individual might have for a money market account, even though I've had them myself. (just because I didn't feel like investing a bunch of money not being used in a checking account ... I would be surprised if I could have bought a beer in a bar with the money it made me over the course of 18 months). Its utility is for institutions.

What's more, I actually know the guy who is credited with having invented money markets. His kids are all proper metal heads.
 
90 missed Q6.... I took a educated guess on that one. I don't really see how anyone failed. Seemed like common sense to me.

amateursurgeon said:
Same.

Although the quiz title is inaccurate. It should be called "Do you understand financial products?"

The two aren't the same - very few people (including financial advisors) actually understand money.
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^ This as well
 
i got a 100%.. wtf im 22 and dont know shit about the technicalitys of 401's ira's and the like.. these were pretty common sense questions imo..

25-29: 53%

thats just sad
 
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