3
practice testMultiple Choice

Practice Test

Question 3 • Personal Finance

Part A: Which investor likely has higher risk tolerance?

Answer
A
Avoids investing
B
Prefers stability
C
Accepts market fluctuations
D
Keeps cash

Explanation

An investor with higher risk tolerance is more willing to accept the possibility of losses in exchange for potential returns. Accepting market fluctuations shows this willingness, so the investor who accepts market fluctuations likely has higher risk tolerance.

AI-written and checked against the verified answer.

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