Posted on 08/30/2014 10:09:19 AM PDT by SeekAndFind
“The college educated are more likely to own stocks and less prone to use high-cost borrowing.” — Journal of Economic Literature
Financial literacy is important, but sadly, only a handful of states require students to take personal finance or an investment course. I earned a Ph. D. in economics and never took a class in accounting, business or personal finance!
How bad is financial education in this country?
In 2008, two economists came up with three simple questions to test the financial knowledge of citizens 55 years or older. See how well you do:
1. Suppose you had $100 in a savings account and the interest rate was 2 percent per year. After 5 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. I do not know.
2. Imagine that the interest rate on your savings account was 1 percent per year and price inflation was 2 percent per year. After 1 year, would you be able to buy:
A. More than today with money in this account.
B. Exactly the same amount as with the money in this account.
C. Less than today with the money in this account.
D. I do not know.
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. I do not know.
(Excerpt) Read more at finance.townhall.com ...
And yet people like this are (a) allowed to vote at all and (b) allowed to vote for demagogues like Osama. D’oh!
Yes, and note what government run schools produce, by design.
I suppose a number responded: What’s a savings account? What’s interest? What’s a stock? What’s a mutual fund?
Democrat voters are either (1) financially illiterate, so they do not understand liberalism, or (2) corrupt, so they expect to profit from liberalism. There are no honest, intelligent votes for democrats. We knew the ill-informed were a majority when Obama won the first time, and we knew the ill-informed were slow learners in 2012.
q.3) sounds more like a sales pitch than a question about basic economic literacy. Did I get that right?
Among foreigners, the Germans and the Swiss did the best (over 50% correct), while the Russians did the worst (4% correct)
No big surprise there!
A Truly Progressive/Liberal person would fail all of these because they would not believe in any of them.
/johnny
RE: Among foreigners, the Germans and the Swiss did the best (over 50% correct), while the Russians did the worst (4% correct)
Well, I was surprised that only 27% of Japanese got it right but on second thought, seeing how their economy has sucked for 2 decades, I am as shocked as Captain Renault in Casablanca.
Not only do they vote they run for and hold office!!!!
The test is flawed though. It does not have the right answer to the first and, by implication, the second question.
1. Suppose you had $100 in a savings account and the interest rate was 2 percent per year. After 5 years, how much do you think you would have in the account if you left the money to grow?
The correct answer is that after taxes the amount will be closer to less than you started with.
seriously?
The dumbing down has gone so far that most Americans probably think high taxes help an economy
Well, you don’t need a savings account or stock or to be concerned about interest when you have an EBT card
DING DING DING, we have a winner. But the question did not mention taxes so most people will not include that factor.
Oh, he is having coffee with Education Union leaders and low information voters. I understand!
This is astonishing. I’m just amazed how stupid what seem to be the majority of people are. I have given them far, far, far too much credit.
It seems like most people are totally absent of what I consider to be simple common knowledge.
How do they function at all?
... would pass with 100% A++ if they selected:
1) D I do not know.
2) D I do not know.
3) C I do not know.
For them, that would be Exactly Right, and just the answer the 'Rat party prefers.
EDIT TO ADD, Maybe those who answered #1 incorrectly were thinking about taxes... but then a multiple choice answer does not give you the luxury of including that factor.
THAT is problem with multiple choice tests.
Hitler once commented that leaders were fortunate that the people did not think. Evidently, the government’s educational goal has been to ensure that the people *cannot* think. Sadly, it worked.
What do puttin air up in mah tires gotta do wit mah EBT card?
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