Strategy Intermediate: Investing for Income

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1.
The stocks of dividend-paying companies are popular among investors who want _______.
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Income. Neither low taxes nor capital appreciation are typical features of income stocks.
2.
Companies that make big profits pay big dividends.
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False. Some of them reinvest their profits to finance future growth.
3.
Income investments usually provide income on a steady basis.
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True. Although it is not always guaranteed, income is usually continuous.
4.
By liquidating _______ in a mutual fund, you can receive income from it.
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Shares. Bonds and taxes cannot be liquidated in mutual funds.
5.
Mutual funds that invest in bonds are income-oriented.
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True. Bonds are income-oriented; they are designed to produce periodic dividend payments.