Question

Steven is considering investing some of his money. He learns that if he invests $2000 in a certificate of deposit, he will likely earn about $15 a year from the interest. He decides to invest somewhere else to earn more money. What did Steven find unsatisfactory about the investment? (1 point)

The return on the investment was too low.

The liquidity of the investment was too high.

The risk of the investment was too high.

None of the above
A bond is sold at face value of $200 with an annual yield of 3%. How much will the bondholder have received in payment from the bond issuer after the bond has reached its maturity date of one year?(1 point)

$200

$406

$206

$6
Determine whether each of the following is direct financing or indirect financing.(1 point)
Direct Financing Indirect Financing
Taking out a loan at a commercial bank


Investing in a friends new business


Selling stock on the stock market


Investing in a mutual fund


Skip to navigation

Answer 1

1) The return on the investment was too low.

2) $206

3)
- Taking out a loan at a commercial bank — Indirect financing
- Investing in a friend's new business — Direct financing
- Selling stock on the stock market — Direct financing
- Investing in a mutual fund — Indirect financing