Choose wisely. There is only one correct answer to each question.
0%
Keep studying!
Review your answers below to learn more.
1.
To determine how quickly a company is growing, examine its _______.
Sales growth. Compare a company's sales growth with those of other companies in the same sector. Examine whether sales growth is speeding up or slowing down, as well as how consistent growth has been.
2.
To determine how profitable a company is, you can examine its cash flow.
False. Cash flow does not tell you much about profitability. The metric you want is return on assets, which measures how well a company uses investors' money.
3.
After a major life event, you should _______.
Re-evaluate your investment goals and risk tolerance. Not every life event has to trigger changes for every investor's portfolio. But we should all re-evaluate our financial plans as we pass through a life stage.
4.
What kind of organizations would you consult to find out whether a prospective financial advisor has ever been subjected to disciplinary action?
Regulatory organizations. Regulatory organizations--whether professional or governmental--can tell you whether your candidate has ever been disciplined.
5.
To determine how profitable a company is, examine its _______.
Return on assets. Return on assets, or ROA, is a key measure of how well a company uses investors' money.
