ECONOMICS
SAVING AND INVESTING
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Municipal bonds
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Junk bonds
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An individual stock
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All of the choices would be good investments for Tyler
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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: -What is one question you should ask before investing in a Roth IRA or Traditional IRA: Do I want to pay taxes now (Roth) or later (Traditional)?
Detailed explanation-3: -Which of the following is NOT a recommended strategy when investing in stocks? avoid investing solely in individual stocks. Many financial advisors recommend that investors diversify their investment portfolio.
Detailed explanation-4: -Confirmation bias. Information bias. Loss aversion/endowment effect. Incentive-caused bias. Oversimplification tendency. Hindsight bias. Bandwagon effect (or groupthink) Restraint bias. More items