11
QuizMultiple Choice

Investing

Question 11 • Personal Finance - EL3403

What might convince an investor to buy stock or mutual funds?

Answer
A
belief that a company has just reached its peak popularity
B
news that a stock's price has recently increased significantly
C
belief that a small number of investors have bought the stock so far
D
news that a company is about to release a promising product

Explanation

An investor may buy stock or mutual funds if they expect a company’s future prospects to improve. A promising product could increase the company’s sales and profits, making its shares more attractive. Reaching peak popularity or having a price that has already risen sharply does not necessarily suggest further growth, and the number of investors who have bought shares is not enough by itself to show that an investment is worthwhile.

AI-written and checked against the verified answer.

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