1. An investment is the current commitment of resources for a period of time in the expectation that an investor will receive in the future a compensation for a) the time for which the resources are committed b) the expected rate of inflation c) the time for which the resources are committed and the expected rate of inflation d) the expected rate of inflation, the time for which the resources are committed, and the uncertainty of future payments. 1. The following is not a reason for investing a) to provide for retirement. b) to fund higher levels of current consumption. c) to fund higher levels of future consumption. d) to fund children's education needs. 2. The statement - 'risk drives expected returns' refers to the notion that a) an investor will require a higher rate of return the higher the perceived riskiness of an asset. b) an investor will require a lower rate of return the higher the perceived riskiness of an asset. c) markets over-react to news. d) markets under-react to news. 3. The basic trade-offs in the investment process are a) between the anticipated rate of return for a given investment instrumentand its degree of risk. b) between understanding the nature of a particular investment and having the opportunity to purchase it. c) between high returns available on single instruments and the d) diversification of instruments into a portfolio