Which Statement About Personal Investing Is TRUE

question 125

Multiple Choice

Which statement about personal investing is TRUE?

• A)Every investment security will generate money.
• B)Individuals who invest in securities must use the services of an investment bank.
• C)Diversification is an investment strategy that increases the expected rate of return but also increases risk.
• D)In general, riskier investment strategies offer the potential for a higher return.

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Definitions:

Output Combination

An output combination refers to the mixture of different goods and/or services produced by an economy or firm within a certain period, highlighting the diversity in production.

Human Capital

The collective skills, knowledge, or other intangible assets of individuals that can be used to create economic value for the individuals, their employers, or the community.

Labor Productivity

The measure of economic output per unit of input, typically calculated as total output divided by the number of hours worked.

Rules Of The Game

The laws, customs, manners, conventions, and other institutional elements that determine transaction costs and thereby affect people’s incentive to undertake production and exchange.