QUESTION 47

Which of the following is an attractive feature of Treasury Inflation Protected Securities (TIPS)?

a. Their interest yield will remain constant if there is future inflation.

b. Their interest yield will automatically increase with the future rate of inflation.

c. Their interest yield will automatically decrease with the future rate of inflation.

d. Their long run rate of return has been higher than the average return of stock market investments.

QUESTION 48

Which of the following is true?

a. Historically, the long-term rate of return of bonds has been greater than stocks.

b. It makes sense to buy bonds that mature about the same time you expect to need the funds.

c. If the rate of inflation rises unexpectedly, the prices of outstanding long-term bonds will increase.

d. If you expect interest rates to rise in the near future, you should buy long-term bonds now.

QUESTION 49

When it comes to an investment in a project or product you've never heard of, you should keep in mind that

a.it is important to make a quick decision, before the opportunity disappears.

b.solicitations by email or telephone are more likely to be genuine.

c.the person offering you the investment has your best interests at heart.

d.if it seems too good to be true, it probably is.

QUESTION 50

Which of the following is a reasonable and prudent way to pay for college education?

a.student loans

b.scholarships, fellowships, or grants

c.saving (possibly with a 529 plan) until you have enough to pay tuition

d.all of the above