Principles of Investment

Question 1

Which rule is important to remember when evaluating risk?

Revolt · Accepted Answer

C: Investments believed to be unpredictable are more risky.

Question 2

Interest rates are generally expressed as a(n) of the loan.

Revolt · Accepted Answer

B: percentage

Question 3

The length of time before a loan must be repaid is called the of the loan.

Revolt · Accepted Answer

C: term

Question 4

How much interest will Pablo receive from his investment?

Revolt · Accepted Answer

B: $250 due to a real interest rate of 5 percent

Question 5

During a period of economic growth, investors are likely to take risks and invest funds.

Revolt · Accepted Answer

A: more

Question 6

Monetary policy is directly implemented by .

Revolt · Accepted Answer

A: the Federal Reserve

Question 7

Loans that are considered to be high risk typically have a interest rate.

Revolt · Accepted Answer

C: high

Question 8

Fiscal policy seeks to affect the economy and interest rates by directly modifying .

Revolt · Accepted Answer

B: taxation and spending

Question 9

The inflation on the amount remaining after taxes and fees is .

Revolt · Accepted Answer

C: $142.50

Question 10

A decrease in the amount of money available to investors is most likely to result in .

Revolt · Accepted Answer

A: less investment

Principles of Investment Answers