Which of the Following Statements Is True

question 13

Multiple Choice

Which of the following statements is true?

• A) Except for tax-exempt investors and tax-deferred accounts, annual tax payments increase investment returns.
• B) The only way to maintain purchasing power over time is to invest in bonds.
• C) After adjusting for taxes, long-term bonds consistently outperform stocks.
• D) An asset allocation decision for a taxable portfolio that does not include a substantial commitment to common stocks may make it difficult for the portfolio to maintain real value over time.
• E) None of the above

---

Definitions:

Stereotype Threat

Feeling that we will be judged and treated in terms of negative stereotypes of our group, and that we will inadvertently confirm these stereotypes through our behaviour.

Confirming Stereotypes

The act of behaving in a way that reinforces existing stereotypes.

Discrimination Threat

The perceived risk of being judged or treated unfairly based on one's group identity.

Stigmas

entail societal labels that identify and devalue individuals or groups based on certain characteristics or behaviors, leading to discrimination and exclusion.