Which of the Following Is True

question 637

Multiple Choice

Which of the following is true?

• A) People who invest in the stock market are virtually certain to make money.
• B) Investors in the stock market can reduce their risk if they hold shares of specific stocks for only short periods of time.
• C) The risk of stock market investments can be reduced through the holding of a diverse portfolio of unrelated stocks over long periods of time.
• D) In the long run, corporate bonds can be expected to yield a higher real rate of return than ownership of stocks.

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Definitions:

Cost

The amount of money required to purchase, produce, or maintain something.

Markup Percent

The extra portion put on the cost of items to cover the expenses of operation and achieve profit.

Selling Price

The amount for which something is sold, making it the price a buyer pays to acquire a product or service.

Markup Percent

The proportion added onto the purchase price of products to account for overhead costs and gain a profit.