Investment Knowledge Quiz

Investment primarily refers to:

• Spending for immediate consumption

• Allocation of funds for future returns

• Borrowing money for expenses

• Hoarding of wealth

The main objective of investment is:

• Maximizing consumption

• Minimizing tax burden

• Earning returns and capital appreciation

• Avoiding risks completely

Which of the following best explains the scope of investment?

• Only financial securities

• Only physical assets

• Both financial and real assets

• Only short-term deposits

Investment is different from saving because:

• Saving always involves risk

• Investment yields returns, saving may not

• Investment reduces income

• Saving requires portfolio management

Investment is usually based on:

• Short-term price fluctuations

• Long-term growth and returns

• Quick profits with high risks

• Random decision making

Speculation can be defined as:

• Risk-free wealth accumulation

• Long-term secured investment

• Buying assets with intention of quick resale for profit

• Government-regulated investment

A key difference between investment and speculation is:

• Investment is short-term, speculation is long-term

• Investment aims at stable returns, speculation at quick gains

• Investment always fails, speculation always succeeds

• Both are risk-free activities

Risk-averse investors usually prefer:

• Government securities and fixed deposits

• Equity shares of startups

• Futures and options

• Speculative assets

An aggressive investor is characterized by:

• Avoiding all forms of risk

• Preferring safe and fixed returns

• Taking high risks for higher returns

• Investing only in gold

Which of the following is a non-financial investment avenue?

• Bonds

• Equity shares

• Real estate

• Debentures