(10.4) Investment Risk and Return Quiz

What does "risk" in investing refer to?

• The certainty of gaining money

• The uncertainty or variability of the outcome of an investment

• The guarantee of losing money

• The fixed return on investment

What might happen if you invest in a company with a strong track record?

• Higher risk and higher return.

• Lower risk and lower return.

• Lower risk and potentially lower return.

• Higher risk and lower return.

Which type of investment is typically issued by the government?

• Penny stocks

• Index funds

• Treasury bills

• Corporate bonds

What is an example of a moderate-risk and moderate-return investment?

• Treasury bills

• Bonds

• Mutual funds

• Cryptocurrency

Which type of investment is associated with high-risk and high-return?

• Bonds

• Index funds

• Stocks

• Treasury bills

What does the Rule of 72 allow investors to see quickly?

• Tax liabilities

• Loan interest rates

• How long it will take for money to double

• Monthly expenses

What is one way to grow your money and reach your goals faster?

• Saving in a bank account

• Investing

• Spending wisely

• Borrowing money

What might vary when receiving dividends?

• The type of stock

• The amount you receive

• The color of the stock certificate

• The number of shares you own

What should you consider if you're unsure about investment options?

• Avoid investing

• Talk to a financial advisor

• Invest randomly

• Ignore the options

What is a dividend?

• A fee charged for stock transactions

• A type of stock

• A portion of a company's earnings distributed to shareholders

• The interest rate on a bond