The History of Risk and Return
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Questions and Answers

Which of the following is a learning objective mentioned in the text?

  • How to calculate the return on an investment using different methods. (correct)
  • The historical risks on various important types of investments.
  • The relationship between risk and return.
  • The historical returns on various important types of investments.

Suppose you invest $300 per month and your investments earn 9% per year. How much money will you have after 5 years?

  • $16,200
  • $8,100
  • $18,000 (correct)
  • $24,300

What is the historical risk of an investment?

  • The potential loss or variability of returns. (correct)
  • The average return over a specific period of time.
  • The historical returns on various important types of investments.
  • The relationship between risk and return.

What is the relationship between risk and return?

<p>Higher risk always leads to lower return. (D)</p> Signup and view all the answers

If you invest $500 per month and your investments earn 7% per year, how long will it take for your investment to reach $100,000?

<p>12 years (A)</p> Signup and view all the answers

Suppose you invest $300 per month and your investments earn 9% per year. How much money will you have after 5 years?

<p>$22,000 (D)</p> Signup and view all the answers

What is the relationship between risk and return?

<p>Higher risk always leads to higher return (D)</p> Signup and view all the answers

If you invest $500 per month and your investments earn 7% per year, how long will it take for your investment to reach $100,000?

<p>15 years (D)</p> Signup and view all the answers

What is the historical risk of an investment?

<p>The potential loss or volatility associated with an investment (A)</p> Signup and view all the answers

Which of the following is a learning objective mentioned in the text?

<p>How to calculate the return on an investment using different methods (B)</p> Signup and view all the answers

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