Dollar Cost Averaging Is a Procedure by Which an Investor

question 27

Multiple Choice

Dollar cost averaging is a procedure by which an investor

• A) buys more stock as its price increases.
• B) times investments in order to buy low and sell high.
• C) invests a fixed dollar amount in a security at fixed intervals.
• D) maintains a constant ratio of conservative and aggressive investments.

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Definitions:

Sample Space

The set of all possible outcomes or results in a probability experiment.

Random Experiment

An experiment or process for which the outcome cannot be predicted with certainty ahead of time, involving random variables.

Mutually Exclusive

refers to events that cannot occur at the same time in a probabilistic experiment.

P(A)

The probability of an event A occurring.