Options for A, B, and C: Best as you approach retirement, Best in the middle of your career, Best early in your career.

Suppose you have a defined-contribution pension plan. As you go through your working life, in what order would you choose to have the following portfolio allocations? a. 100% stocks: b. 100% bonds and money-market instruments: c. 50% bonds and 50% stocks: Why? Early in your working life, investing in stocks makes sense as they generally earn a relatively high rate of return, though they are very risky even over the long term. Mid-career switch exclusively to bonds, then transition to stocks and bonds later. With a defined-contribution pension plan, your employer bears the risk associated with the asset allocation of the funds, so you do not need to be concerned about the order. Early in your working life, investing in stocks makes sense as they generally earn a relatively high rate of return and are relatively safe when held over the long term. As you approach retirement, you should gradually convert to bonds and more liquid instruments. Early in your working life you should stick to safe, liquid instruments while you learn about investing and then gradually build up to a portfolio of stocks as you approach retirement