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1.
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.
2.
Inflation means you will have more spending power in the future than you do today.
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False. Inflation leads to lower spending power in the future.
3.
The goal of a tax-managed fund is tax efficiency.
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True. The goal of a tax-managed fund is tax efficiency.
4.
An investment's volatility over the long term generally _______ compared to its volatility over the short term.
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Decreases. Volatility generally decreases when comparing longer investment periods to shorter ones.
5.
Long time horizons generally enable us to assume _______ short-term ones.
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More risk than. Time reduces risk.