The chapter ‘Systematic Savings and Investments’ in Class 9 introduces students to essential financial habits like saving regularly, budgeting, and making smart investment choices.
Systematic Savings and Investments Class 9 NCERT Solutions
I. Choose the correct answer.
Q. Savings is the activity of setting aside a part of __ for further use.
a) Cash/Kind
b) Life
c) Investments
Q. Savings can be defined as “the portion of disposable income not spent on __.”
a) Consumption
b) Expenses
c) Investment
Q. __ term investments are known as speculation.
a) Long
b) Short
c) Medium
Q. Time value of money is a concept that addresses the way the value of __ changes over a period of time.
a) Lifestyle
b) Currency
c) Money
II. Fill in the blanks.
Q. Savings is _ of income over expenditure.
Show Answer ⟶Q. Investments are for a _ period.
Q. Under Savings people use their _ money.
Show Answer ⟶Q. Investments can be made in or assets.
Show Answer ⟶Q. SIP is the investment of a _ amount in any of the financial assets at regular intervals.
Show Answer ⟶III. Match the following.
- Saving – Bulls and Bears
- Investor – Small amounts can also be invested.
- Speculation – Excess of income over expenditure
- Investment – Sacrificing current consumption
- SIP – To earn above inflation
Correct Match
- Saving – Excess of income over expenditure
- Investor – Small amounts can also be invested.
- Speculation – Bulls and Bears
- Investment – Sacrificing current consumption
- SIP – To earn above inflation
IV. True or false.
Q. Currency is a form of real asset.
Show Answer ⟶Q. Investment is to make losses out of money.
Show Answer ⟶Q. Savings are for a shorter period.
Show Answer ⟶Q. A fixed sum of money given now and given after a period of time have different values.
Show Answer ⟶Q. Tax benefits are not available for SIP.
Show Answer ⟶V. Answer the following in one word or in a sentence.
Q. Expand SIP.
Answer: Investments can be made at one time or at regular intervals, like recurring deposits. Systematic Investment Plan is the investment of a fixed amount in any of the financial assets at regular intervals. It is the simple and timely investment strategy for accumulating wealth and capital appreciation.
Q. Define savings?
Answer: Saving is the activity of setting aside a part of cash/kind for future use. The loss to saving could be wasteful expenditure or uneconomical spending. For example, when a particular sum of money is intended for buying all your stationery requirements, it is a wasteful expenditure if you use the money for buying chocolates and ice creams, and it is a non-economical spending if you buy only one notebook by using the entire sum of money.
Q. What is speculation?
Answer: Short-term investments are known as speculation. In speculation there is an investment of funds for a short period to get some returns. The speculator makes use of the fluctuations in the movement of the price of an asset and has high risk. There are two main categories of speculators in the stock market, namely bulls and bears.
Q. Define simple interest.
Answer: Simple interest is computed only on the original amount borrowed. It is the return on that principal for one time period.
Q. What is compound interest?
Answer: Compound interest is calculated each period on the original amount borrowed plus all unpaid accumulated interest.
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