2
QuizMultiple Choice

Financial Planning and Consumer Protection — Test

Question 2 • CMS 2026-2027 Economics and Personal Finance INITIAL CREDIT

Compared to a short-term investment, what is the general return of a long-term investment?

Answer
A
A long-term investment has a lower return because it has lower risk.
B
A long-term investment has a similar return to a short-term investment.
C
A long-term investment has a greater return because it has lower risk.
D
A long-term investment has a greater return because it has greater risk.

Explanation

Long-term investments usually involve more uncertainty because there is more time for market conditions to change. Investors generally expect a greater return to compensate for taking on that greater risk. So the correct choice is “A long-term investment has a greater return because it has greater risk.”

AI-written and checked against the verified answer.

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