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1.
Inflation means you will have more spending power in the future than you do today.
Choose wisely. There is only one correct answer.
False. Inflation leads to lower spending power in the future.
2.
Long time horizons generally enable us to assume _______ short-term ones.
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More risk than. Time reduces risk.
3.
In the long term, bonds and cash generally have lower returns than stocks.
Choose wisely. There is only one correct answer.
True. In the long term, stocks tend to have higher returns than other investments.
4.
In general, bonds have more volatility and higher returns than either stocks or cash.
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False. While bonds may show more volatility than cash, stocks generally have higher returns and volatility than bonds or cash.
5.
The goal of a tax-managed fund is tax efficiency.
Choose wisely. There is only one correct answer.
True. The goal of a tax-managed fund is tax efficiency.