Income resulting from an increase in the value of an investment is a

a. return on corporate profits.

b. capital gain.

c. dividend.

d. real return.

A systematic program of investing equal sums of money at regular intervals regardless of the price of the investment results in

a. portfolio diversification.

b. a lower average share cost.

c. a lower average share price.

d. reduced risk.

Selecting a proportion of your overall portfolio that you will maintain in various classes of stocks, bonds, money market investments, and mutual funds on a consistent basis year after year is a characteristic of which long-term investment technique?

a. leverage

b. dollar-cost-averaging

c. buy-and-hold

d. asset allocation

The process of selecting groups of investments with dissimilar risk/return characteristics is called

a. contrarianism.

b. asset averaging.

c. dollar-cost averaging.

d. portfolio diversification.

A collection of securities and other investments is called a

a. portfolio.

b. diversification.

c. principal.

d. salary reduction plan.

An explanation of your investment philosophy and your logic on investing to reach specific goals is encapsulated in your

a. portfolio.

b. investment plan.

c. trade-offs.

d. lifestyle.

Investments with high levels of risk will tend to have

a. potential for both high returns and heavy losses.

b. potential for both low returns and heavy losses.

c. potential for both high returns and low losses.

d. pure risk.

Your general approach to investment risk is your

a. risk tolerance.

b. investment philosophy.

c. monthly investment plan.

d. investment pattern.