Since Mike and Carol Are Nearing Retirement Age, They Are

question 99

Multiple Choice

Since Mike and Carol are nearing retirement age, they are concerned with the need for their investments to provide income. If you were a financial planner, which of the following would you not recommend to Mike and Carol as an investment?

• A) Blue-chip stocks known for paying dividends
• B) Stocks of high-growth companies
• C) Corporate bonds
• D) Government bonds
• E) Certificates of deposit

Understand the basic assumptions underlying economic theories, including the maximization of profits by firms.

Grasp the importance and process of testing and revising economic theories to describe economic behavior.

Recognize the trade-offs faced by firms in production decisions.

Distinguish between normative and positive economic analysis.

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Definitions:

Vesting Rights

The process by which an employee accrues non-forfeitable rights over employer-provided stock incentives or pension plans contributions after a period of time.

Pension Benefits

Financial payments made to individuals after retirement, based on their previous employment’s duration and earnings.

Fair Labor Standards Act

A US federal law that establishes minimum wage, overtime pay eligibility, recordkeeping, and child labor standards affecting full-time and part-time workers.

Minimum Wage

The lowest legal hourly pay for workers, as mandated by government regulation, intended to ensure a basic standard of living for employees.