ECONOMICS
FINANCIAL MARKETS
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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An investor makes money by earning interest.
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An investor DO NOT make money by earning interest.
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Either A or B
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None of the above
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Detailed explanation-1: -Which statement best describes how an investor makes money off debt? An investor makes money by issuing bonds.
Detailed explanation-2: -Generating income from debt involves taking out a loan and using the borrowed funds to invest in an income-producing asset. This could include buying bonds, investing in stocks, or purchasing real estate. The income generated from this investment can then be used to pay off the debt.
Detailed explanation-3: -Investment income is the profit earned from investments such as real estate and stock sales. Dividends from bonds also are investment income. Investment income is taxed at a different rate than earned income.
Detailed explanation-4: -An investor is an individual that puts money into an entity such as a business for a financial return. The main goal of any investor is to minimize risk and maximize return.