28
QuizMultiple Choice

Cumulative Exam — Cumulative exam

Question 28 • EA Academy Civics 9

Sabina’s financial advisor tells her that investing in stocks for a new start-up company has a high rate of risk.What does that mean?

Answer
A
Even if stock prices go up, Sabina will not make money from her investment.
B
There are few investors, so Sabina has more responsibility for the company’s success.
C
There is a large chance that her investment will not reach the expected rate of return.
D
Sabina’s money will double in value due to the investment.

Explanation

A high-risk investment has a greater chance of earning less than expected or losing value. So the advisor means there is a large chance Sabina’s investment will not reach its expected rate of return. High risk does not guarantee that she will lose money, nor that her investment will double.

AI-written and checked against the verified answer.

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