Ethical and Responsible Investments Quiz
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Questions and Answers

What is the main characteristic of impact investors?

  • They allocate capital to businesses with negative environmental impacts.
  • They focus solely on financial gains.
  • They prioritize organizations with vague terminology.
  • They expect measurable and beneficial outcomes beyond financial gains. (correct)

Which deceptive practice involves presenting selective data or statistics to make a product or company appear more environmentally responsible than it is?

  • Diversion Tactics
  • Cherry-Picking Data (correct)
  • Vague Terminology
  • Misleading Labels

What term is used for an organization portraying itself as environmentally friendly when its operations negatively impact the environment?

  • Green Washing (correct)
  • Cherry-Picking Data
  • Vague Terminology
  • Misleading Labels

How do companies engage in Diversion Tactics regarding environmental claims?

<p>By focusing on unrelated charitable contributions (D)</p> Signup and view all the answers

What is the primary issue with using Vague Terminology in environmental claims?

<p>It confuses consumers. (C)</p> Signup and view all the answers

Which factor does NOT affect the choice of investments?

<p>Charitable contributions (C)</p> Signup and view all the answers

What is the importance of establishing investment goals?

<p>To provide direction and purpose for investment decisions (D)</p> Signup and view all the answers

What preparation is necessary to embark on an investment plan?

<p>Establishing investment goals (C)</p> Signup and view all the answers

How do companies misleadingly imply environmental friendliness?

<p>By using vague terminology (A)</p> Signup and view all the answers

What is the center of the asset allocation process in investments?

<p>The choice of investments (A)</p> Signup and view all the answers

What is the main disadvantage of REITS mentioned in the text?

<p>Debt used for leverage effect (D)</p> Signup and view all the answers

When structuring an investment portfolio, which criteria are mentioned in the text?

<p>Risk Tolerance Level (D)</p> Signup and view all the answers

An investor with high risk tolerance would most likely have a portfolio with:

<p>Only high-risk assets (A)</p> Signup and view all the answers

What is the potential impact on an investor's choice of investments if they are more focused on investment growth rather than investment income?

<p>The investor may choose riskier investments with higher potential for capital appreciation. (C)</p> Signup and view all the answers

How does an investor's age typically influence their risk tolerance and investment choices?

<p>Older investors usually prefer low-risk assets to protect their retirement savings. (C)</p> Signup and view all the answers

How does an investor's liquidity needs impact their investment decisions?

<p>Investors with low liquidity needs usually hold assets that can be quickly converted into cash. (C)</p> Signup and view all the answers

In the context of investment risks, which investor is likely to have a higher proportion of international equities in their portfolio?

<p>An investor with high risk tolerance (D)</p> Signup and view all the answers

What is the primary reason for including international fixed-income investments in a portfolio?

<p>To hedge against currency fluctuations (D)</p> Signup and view all the answers

Which type of asset allocation is more likely to include tangible assets like real estate and gold?

<p>High risk tolerance portfolio (D)</p> Signup and view all the answers

When comparing international fixed-income investments and international equities, which asset class typically carries higher volatility?

<p>International equities (C)</p> Signup and view all the answers

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