[Synchronous] Activity 3

Risk tolerance refers to an investor’s willingness to take on risk but not their ability to do so.

• TRUE

• FALSE

An investor planning for a long-term goal, like retirement in 30 years, might have a lower risk tolerance compared to someone saving for a short-term goal.

• TRUE

• FALSE

Desired return and required return are always the same for an investor.

• TRUE

• FALSE

If an investor is aiming for high returns, they should likely invest in high-growth stocks or mutual funds.

• TRUE

• FALSE

Liquidity constraints relate to the need for cash or easily sellable assets.

• TRUE

• FALSE

Time horizon is irrelevant when deciding on the types of investments to choose.

• TRUE

• FALSE

Tax considerations might affect an investor’s choice to include certain tax-efficient investments in their portfolio.

• TRUE

• FALSE

nique circumstances, such as personal or ethical considerations, may influence an investor’s decision to avoid certain industries.

• TRUE

• FALSE