Investing

Investments are

• Profit or income generated by saving and investing
• Assets purchased with the goal of providing income but with the risk of loss
• Higher returns=Higher Risks
• Possibility that an investment will fail to pay the expected return

Which of these is NOT a form of investing?

• Stocks
• Bonds
• Mutual Funds
• Real Estate
• Savings Account

A Bond is a

• A share of ownership in a company
• Form of lending to a company or the government

A stock is a

• A share of ownership in a company
• Form of lending to a company or the government

When we are talking about investments, return means

• Profit or income generated by saving and investing
• Assets purchased with the goal of providing income but with the risk of loss
• Higher returns=Higher Risks
• Possibility that an investment will fail to pay the expected return

Investment Risk means

• Profit or income generated by saving and investing
• Assets purchased with the goal of providing income but with the risk of loss
• Higher returns=Higher Risks
• Possibility that an investment will fail to pay the expected return

The most common relationship between risk and return in investing can be stated as:

• higher risk indicates lower return
• higher risk indicates higher return
• lower risk indicates higher return
• No relationship exists between risk and return

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NGSS.HS-ETS1-3

Mrs. Donahue is suggests that you diversify your portfolio. A diversified portfolio is desirable because it:

• increases the risk/return ratio
• limits investors choices to only one or two investment tools
• decreases risk by investing money in a variety of investments

Which of the following is not true in regards to investing in stock?

• A stockholder owns a part of a company.
• A stockholder may or may not receive a dividend.
• A stockholder will always receive a profit when the stock is sold.

Conner wants to purchase stocks with the money he received from his tax return. Who would he contact to make the transaction?

• A stock broker or brokerage firm

• The New York Stock Exchange
• A real estate agent
• Conner should complete this transaction on his own