ECONOMICS
SAVING AND INVESTING
|
Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
|
|
|
a down payment
|
|
|
risk
|
|
|
taxes
|
|
|
None of the above
|
Detailed explanation-1: -The biggest difference between saving and investing is the level of risk taken. Saving typically results in you earning a lower return but with virtually no risk. In contrast, investing allows you the opportunity to earn a higher return, but you take on the risk of loss in order to do so.
Detailed explanation-2: -Short-term certificates of deposit. Money market funds. Treasury bills, notes, bonds and TIPS. Corporate bonds.
Detailed explanation-3: -Investing has the potential for higher returns than savings accounts, the ability to grow your wealth over time through compounding and reinvestment, and the opportunity to help you achieve long-term financial goals, such as saving for retirement or buying a house.
Detailed explanation-4: -The difference between saving and investing Saving can also mean putting your money into products such as a bank time account (CD). Investing-using some of your money with the aim of helping to make it grow by buying assets that might increase in value, such as stocks, property or shares in a mutual fund.