An Investor Is Faced with a Decision of Investing $5,000

question 23

Multiple Choice

An investor is faced with a decision of investing $5,000. The investor is in no hurry to cash in on their gains and is considered risk-averse. Which option should they choose?

• A) The 2% rate, because it is the longest payout
• B) The 3% rate
• C) The 6% rate, because it is the highest guaranteed return
• D) The 10% rate, because the risk is worth the higher return
• E) Either the 2% rate or the 6% rate, as they both offer the same total return

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Definitions:

Creative Inspiration

The process or moment of being mentally stimulated to do or feel something, especially to something creatively.

Distinct Approaches

Unique or different methods or strategies used to tackle problems or tasks.

Prior Knowledge

Pre-existing knowledge, information, or understanding that a person has before learning something new.

Pattern Recognition

The ability to detect regularities, patterns, or trends in data, which is essential in fields like computer science, psychology, and artificial intelligence.