Strategy Intermediate:
Retirement Investing Strategies
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1.
The goal of a tax-managed fund is tax efficiency.
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True
False
True. The goal of a tax-managed fund is tax efficiency.
2.
Long time horizons generally enable us to assume _______ short-term ones.
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More risk than
Less risk than
The same risk as
More risk than. Time reduces risk.
3.
Putting off payment of your taxes until later is known as _______.
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Tax efficiency
Unrelated business income
Tax deferral
Tax deferral. This is advantageous when it comes to retirement planning.
4.
The amount your investment changes up and down in value over time is known as ______.
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Rate of return
Volatility
Risk
Volatility. The tendency for investment values to fluctuate up and down is known as volatility.
5.
If you want the safety of low-volatility investments, you will have to accept ________ as well.
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Low risk
Lower returns
Certificates of deposit
Lower returns. As a rule, the lower the volatility of an investment, the lower the potential return.
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