Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. finance
  3. your friend promises you an investing opportunity

Your friend promises you an investing opportunity that she claims has no risk but will provide...

50.1K

Verified Solution

Question

Finance

Your friend promises you an investing opportunity that sheclaims has no risk but will provide a guaranteed 20% annual return.(Note: U.S. Treasuries are providing a return of 2%.) What shouldyou do? Group of answer choices Split the difference: put half ofyour investment in your friend's investing opportunity and half inU.S. Treasuries. This is possible but you should at least check outyour friend's track record and if there are investors who have beenreceiving 20% return anually, go ahead and invest. Don't invest.This sounds like a scam because it is not consistent with therelation between risk and return. This sounds like a sweet deal.Invest $100,000 with your friend.

Answer & Explanation Solved by verified expert
4.2 Ratings (506 Votes)
While making investment decisions one important aspect to consider is what one is getting in return for the investment being made Though this is one of the first things investors think of    See Answer
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students

Q

Part A.The emissivity of the human skin is 97.0 percent. Use 35.0 °C for the skin...

Physics
Q

How many colors are needed to color a planar graphs? Give a proof that each planar...

Advance Math
Q

The Zhou introduced the idea of the dynastic cycle. What is the dynastic cycle?O the...

Biology
Q

Word count 100 150 In the chapter excerpt Lenity and the Scope of Adverbs Solan...

Biology
Q

Assertion A The Coulomb force between two points charges depend upon the dielectric constant of...

Physics
Q

Solve the triangle. The Law of Cosines may be needed. (Standard notation for triangle ABC...

Algebra
Q

The partial sum 1 10 19 307 equals C

Algebra
Q

QUESTION 1 Shamar intentionally caused physical injury to Fran. Shamar lives in Rochester,...

Accounting
Q

D. Restricted Stock On December 31, 2014, Ying Corporation granted 5,000 shares of its $1...

Accounting
Q

Identify 3 market segments that are applicable to your cafe. How will these influence your...

Accounting
Q

Shelly has $200,000 of QBI from her local jewelry store (a sole proprietorship). Shellys proprietorship...

Accounting
Q

Stockholders' Equity Preferred 7% Stock cumulative and nonparticipating, $25 par value, $22 redemption value, 10,000...

Accounting