8.10 Investing Alternatives

Tangible investments include:

• collectible and hard assets

• stocks in large companies

• government bonds

• options on real estate

A tangible investment is something you can:

• sell

• hold

• buy

• hold, buy, and sell

Which of the following is NOT a hard asset investment?

• real estate

• silver

• gold

• REITs

Which of the following could be a collectible and potentially worth more than its original cost?

• an automobile

• a baseball card

• both an automobile and baseball card

• neither an automobile nor baseball card

Which of the following are among the five main participants within the sphere of tangible investing?

I. hobbyist

II. creators

III. collectibles

IV. dealers

• I, II, and IV only

• I, II, and III only

• I, II, III, and IV

• I and II only

How do dealers make money?

• buy items at their true value and find buyers willing to pay more

• make market for tangible goods

• buy many items hoping that some become valuable enough to sell at good prices

• consistently buy items at low prices and resell them at higher prices

When it comes to investing, you can be a(n):

I. developer

II. owner

III. lender

IV. dealer

• I, II, and IV only

• II and III only

• I, II, III, and IV

• I and II only

Auction sites like Ebay or Ubid make it easy to buy and sell tangible assets. But they also:

• guarantee items will be sold

• help create demand for tangible assets

• make it easier to make money in tangible assets

• impose cost that reduce the spread that can be made buying and selling tangible assets

Equilibrium:

• helps determine how much it should cost to sell a tangible assets

• shows that demand for an item is more important than the supply

• is where demand of an asset equals the supply for an asset

• denotes excess supply in the market

Which of the following tangible asset markets is largest (based on annual sales)?

• gold market

• U.S. commercial real estate

• worldwide art sales

• worldwide stamp collection sales