Why are stocks risky, but not as risky as not investing in them?
What will be an ideal response?
Answer: Stocks are risky due to the ups and downs experienced both in the individual stock as well as in the stock market in general. They are indeed risky.
They are not as risky as not investing in them for the following reasons:
1. Diversification will reduce the risk of owning individual stocks.
2. The time dimension of planning will reduce the general market risks (fluctuations).
3. You will be better able to keep ahead of inflation and taxes.
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Current liabilities are those obligations that are due within one year or the normal operating cycle of the business, whichever is longer, and which will require use of current assets
a. True b. False Indicate whether the statement is true or false
When common stock is issued by a corporation for a cash price above par value, the excess of the cash proceeds over the par value should be reported in the financial statements as a component of
A) retained earnings on the balance sheet. B) total liabilities on the balance sheet. C) operating income on the income statement. D) total contributed capital on the balance sheet.
R&M Chatelaine is one of the largest tax-preparation firms in the United States. It wants to acquire The Tax Experts, a smaller rival. After the merger, Chatelaine will be one of the two largest income-tax preparers in the U.S. market. What should Chatelaine include in its acquisition plans?
A. Chatelaine should enter a price-based competition with its other major competitor to force it out of business and become a monopoly. B. Chatelaine will need to explain to the Federal Trade Commission how the acquisition will not result in an increase in prices for consumers. C. It should refocus its attention from the national to the international market. D. In addition to acquiring The Tax Experts, it should also determine the best way to drive independent "mom and pop" tax preparers out of business.
An employee who has not been hired for more than a year can be fired by the employer for any reason or for no reason. This is the doctrine of:? A) self employed.? B) ?employment-at-will
C) ?contractual employed. D) ?whistleblowers.