Introduction to Investment: What is Investment?
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Questions and Answers

What is the essential element of investment?

  • Return (correct)
  • Consumption
  • Risk
  • Sacrifice

    • Which characteristic is inherent in any investment?

  • Risk (correct)
  • Yield
  • Return
  • Capital appreciation

    • What does investment involve?

  • Return and consumption
  • Capital appreciation and yield
  • Risk and sacrifice (correct)
  • Delay in repayment and non-payment of interest

    • What is the primary objective of making investments?

    <p>Deriving a return</p> Signup and view all the answers

    What is the possibility of variation in the actual return known as?

    <p>Risk</p> Signup and view all the answers

    What is investment defined as?

    <p>Sacrifice made now to obtain a return in the future</p> Signup and view all the answers

    What is the primary concern of an investor?

    <p>Maximizing return</p> Signup and view all the answers

    Which factor affects the risk of an investment based on the text?

    <p>The nature of the investment</p> Signup and view all the answers

    What does the safety of an investment imply based on the text?

    <p>Certainty of return without any loss of money or time</p> Signup and view all the answers

    What does the term 'liquidity' refer to in the context of investments?

    <p>Marketability without loss of value and time</p> Signup and view all the answers

    What is the objective of an investor as stated in the text?

    <p>Maximization of return</p> Signup and view all the answers

    What does it mean for an investment to be 'liquid'?

    <p>Easily marketable without loss of value and time</p> Signup and view all the answers

    What is meant by 'minimization of risk' as per the text?

    <p>Minimizing the probability that actual returns may be different from expected returns</p> Signup and view all the answers

    What does 'investor' mean based on the text?

    <p>An individual or institution who commits money to investment products with expectation of financial return</p> Signup and view all the answers

    What do investors generally desire in terms of returns and risk?

    <p>High returns with low risk</p> Signup and view all the answers

    What is the main reason why people invest according to the text?

    <p>To earn a return from savings due to deferred consumption</p> Signup and view all the answers

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