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Retirement Intermediate:
Retirement Investing Strategies
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Choose wisely. There is only one correct answer to each question.
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1.
The amount your investment changes up and down in value over time is known as ______.
Choose wisely. There is only one correct answer.
Rate of return
Volatility
Risk
Volatility. The tendency for investment values to fluctuate up and down is known as volatility.
2.
If you want the safety of low-volatility investments, you will have to accept ________ as well.
Choose wisely. There is only one correct answer.
Low risk
Lower returns
Certificates of deposit
Lower returns. As a rule, the lower the volatility of an investment, the lower the potential return.
3.
You will be penalized for withdrawing money from pension plans before age 73.
Choose wisely. There is only one correct answer.
True
False
False. You will be penalized if you withdraw your retirement money before age 59½.
4.
Inflation means you will have more spending power in the future than you do today.
Choose wisely. There is only one correct answer.
True
False
False. Inflation leads to lower spending power in the future.
5.
In the long term, bonds and cash generally have lower returns than stocks.
Choose wisely. There is only one correct answer.
True
False
True. In the long term, stocks tend to have higher returns than other investments.
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