Which of the following investment instruments would a risk-loving individual choose?
A) government bonds
B) stocks from a company listed on the Dow Jones Industrial Average
C) stock from a very new company that has high growth potential
D) a low-risk mutual fund

Question

Quizplus · Accepted Answer

A risk-loving individual would likely choose stock from a very new company that has high growth potential because it has the potential for a high return on investment, but also comes with a higher level of risk. Options A and D, government bonds and a low-risk mutual fund, respectively, are both low-risk investments with lower potential for returns. Option B, stocks from a company listed on the Dow Jones Industrial Average, could be a good choice for a risk-averse individual as these are established companies with lower risk, but also lower potential for high returns.

Which of the Following Investment Instruments Would a Risk-Loving Individual