17
QuizMultiple Choice

N/A — Exam

Question 17 • CMS 2026-2027 Economics and Personal Finance HONORS INITIAL CREDIT

Angela is considering buying stock in a popular computer software company whose price has dropped significantly in the last year. Why might this be a wise move for Angela to make?

Answer
A
because the company will rebound because she likes to use the products they sell
B
because it is smart to buy when prices are high and sell when prices are low
C
because it is smart to buy when prices are low and sell when prices are high
D
because her investment will be guaranteed by the government if the company fails

Explanation

A stock’s price being low may give Angela an opportunity to buy at a lower cost and potentially sell later if its price rises. This is the principle of buying low and selling high, so choice B is correct. The investment is not guaranteed by the government, and liking the company’s products does not guarantee that its stock price will recover.

AI-written and checked against the verified answer.

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