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FINRA Financial Literacy Quiz
Old 08-30-2020, 06:13 PM   #1
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FINRA Financial Literacy Quiz

Simple test for most of you smarty pants. It's only 6 Qs, but my fellow Texans averaged only 2.9 correct! I am embarrassed for them.

Have fun.

https://www.usfinancialcapability.org/quiz.php
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Old 08-30-2020, 06:26 PM   #2
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Did get all questions correct. Some state results were interesting.
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Old 08-30-2020, 07:02 PM   #3
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5 out of 6, the bonus question got me.
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Old 08-30-2020, 08:18 PM   #4
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The first question started with “suppose you have a savings account yielding 2%....” Based on the interest rate in figured it must be a trick question.
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Old 08-30-2020, 08:19 PM   #5
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5 out of 6, the bonus question got me.


Just remember the rule of 72. Divide 72 by the interest rate and that’s roughly how many years money (or debt) takes to double.
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Old 08-30-2020, 08:25 PM   #6
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Just remember the rule of 72. Divide 72 by the interest rate and that’s roughly how many years money (or debt) takes to double.
I knew the rule of 72, and still missed the last question because I did 72/20 in my head wrong. I'm going to claim I was distracted by the thought of "WTH is this person doing borrowing money at 20%!?!"

Got the first five right though.
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Old 08-30-2020, 08:47 PM   #7
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Did get all questions correct. Some state results were interesting.
Same here for both.
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Old 08-30-2020, 09:11 PM   #8
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6 correct. The quiz was pretty easy in my estimation.
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Old 08-30-2020, 09:11 PM   #9
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Suppose you have $100 in a savings account earning 2 percent interest a year. After five years, how much would you have?
When I read the first question (above), I looked away from the screen to do the calculation in my head. I computed the binomial expansion to second order, and then decided that third order probably wouldn't be necessary -- i.e., I already had the answer to within a fraction of a dollar, they couldn't possibly want the answer better than that! Then I looked and saw the choices for the answer, which were, umm, not very exacting or incisive.

6/6 overall.
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Old 08-31-2020, 05:03 AM   #10
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6/6. Easy Peazy.
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Old 08-31-2020, 05:15 AM   #11
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Just remember the rule of 72. Divide 72 by the interest rate and that’s roughly how many years money (or debt) takes to double.
Got 6 of 6, but didn't remember the 72 rule. I just did a quick summary in my head, knowing that in year three, we already have 600 extra, and 20% of that 180, so with the extra compounding earlier, it has to be over 1000 before year 5.
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Old 08-31-2020, 05:23 AM   #12
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6 out of 6; but I am a tad surprised that the national average is so high (50%).

My sister bought a house with a 30 year mortgage and was shocked to learn that she had to pay back more than the loan amount. I was shopping in Macy's once and overheard a mother and young adult daughter try and fail to figure out what a 15% discount on a $10 blouse would come to. And on and on. The list is almost endless.
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Old 08-31-2020, 05:32 AM   #13
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6/6. The coffee must be working this morning.
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Old 08-31-2020, 05:49 AM   #14
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6/6. It’s a shame financed aren’t included in math classes in school. It seems kids would be more engaged if money is involved. I can’t imaging missing any of the questions except for sloppy moments in submitting answers.
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Old 08-31-2020, 05:52 AM   #15
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Did get all questions correct. Some state results were interesting.
+1
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You got 6 correct answers out of 6
Congratulations to Nebraska and Utah at 3.4 vs 3.0 nationwide. Back to the books for Georgia and Mississippi at 2.7.
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Old 08-31-2020, 06:26 AM   #16
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Piece of cake
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Old 08-31-2020, 07:20 AM   #17
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Unsurprisingly most here got 6/6, but what interests me is the different methods everyone used for number 6.

The Law of 72 is the easiest and most frequently used and gave the correct answer in this case, but is an approximation and can get you in trouble if you're near the boundary between one year and another for doubling time. Specifically with 20% interest the law of 72 gives a 3.6 year doubling time while the actual number is 3.8. Close enough in this case, but illustrates why some other posters were wise to double check with other methods.

The binomial expansion to several orders and the direct method of just calculating the compound each year certainly work, but require a good number of arithmetic calculations. While I could manage this, as I've gotten older my "internal stack height" of numbers I can hold in my head for calculations has gotten smaller (or I've just gotten lazier) and those seemed a bit laborious. I just squared 1.2 to get 1.44, saw that was more than sqrt(2) and that meant 1.2^4 > 2 hence the doubling time was less than 4 years. None of these methods is better or worse than any other, but its interesting to see how different heads work.
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Old 08-31-2020, 07:37 AM   #18
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I was shopping in Macy's once and overheard a mother and young adult daughter try and fail to figure out what a 15% discount on a $10 blouse would come to.
And they probably each had a calculator on their cell phones. Sad.

What is even sadder is how many people are proud to proclaim they are horrible at basic math. Some folks think of weak math skills as a badge of honor somehow, rather than as the handicap it really is.
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Old 08-31-2020, 07:40 AM   #19
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The quiz was quite easy which makes the average results quite scary.
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Old 08-31-2020, 07:47 AM   #20
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Unsurprisingly most here got 6/6, but what interests me is the different methods everyone used for number 6. ...
I didn't do any complex calculations... with simple interest it would take 5 years to double...so with compounding the answer has to be less than 5 years ... whcih suggested the 2-4 year choice... and with compounding it would have to be more than 2 years... so 2-4 years had to be the right answer.
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