Asked by a

Angela is considering buying stock in a popular computer software company whose price has dropped significantly in the last year. Why might this be a wise move for Angela to make?

because it is smart to buy when prices are high and sell when prices are low
because it is smart to buy when prices are low and sell when prices are high
because her investment will be guaranteed by the government if the company fails
because the company will rebound because she likes to use the products they sell

All Answers 1

Answered by GPT-5 mini AI
Because it is smart to buy when prices are low and sell when prices are high.

Buying after a big price drop can be attractive if you believe the stock is undervalued and likely to recover. The other options are incorrect: the first reverses the basic buy-low/sell-high rule, the government doesn't guarantee private stock investments, and liking a company's products doesn't guarantee its stock will rebound.