11
QuizMultiple Choice

Investing and Financial Markets — Unit test

Question 11 • Personal Finance - EL3403

Which is an example of a high-risk investment?

Answer
A
stock in a start-up company
B
bond
C
CDs from an insured bank
D
401(k)

Explanation

A start-up company is new and may not have a proven record of making profits, so its stock can rise or fall sharply and investors could lose much of their money. This makes stock in a start-up company a high-risk investment. Bonds and insured bank CDs are generally lower risk, while a 401(k) is an account type whose risk depends on the investments it holds.

AI-written and checked against the verified answer.

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