AnswersPersonal Finance - EL3403Investing and Financial Markets

Investing and Financial Markets Answers

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Which statements describe the role of risk in making investment decisions? Check all that apply.When discussing investments, “risk” is the possibility of little or no return.Risk is an element to consider when investing in stocks.Low risks typically have high returns.The higher an investment’s risk, the greater its potential return will be.When making an investment, profits are always guaranteed.

A
When discussing investments, “risk” is the possibility of little or no return.
B
Risk is an element to consider when investing in stocks.
C
Low risks typically have high returns.
D
The higher an investment’s risk, the greater its potential return will be.
E
When making an investment, profits are always guaranteed.
4

Which statement is supported by the information in the graph?The value of Pear stock increased every year from 2005 to 2013.Pear was the most profitable stock that could be purchased between 2005 and 2013.The price of Pear stock declined from 2008 to 2009.2008 was the best year to purchase Pear stock.

A
The value of Pear stock increased every year from 2005 to 2013.
B
Pear was the most profitable stock that could be purchased between 2005 and 2013.
C
The price of Pear stock declined from 2008 to 2009.
D
2008 was the best year to purchase Pear stock.
6

Which conclusions can be made about the growth of the economy? Check all that apply.

A
Aggregate demand increased after 2009.
B
Aggregate demand increased between 2010 and 2011.
C
The economy remained stable in 2008.
D
The economy experienced a sharp drop in growth between 2008 and 2009.
E
The economy grew weaker after a crash in 2010.

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