Question

8 stephanie plans to start investing, but she has no investment experience. she prefers to invest in a low - risk investment that often has quick transactions. one of her friends recommended her to invest in cryptocurrency. why is cryptocurrency the least suitable investment option for stephanie? a it requires additional fees for transactions. b it can be bought through online exchanges. c it involves high loss of principal invested. d it involves slow transactions and low returns. vzqulj912nabrthuzw5nn1qtjut9 0

Explanation:

To determine why cryptocurrency is not suitable for Stephanie, we analyze each option:

• Option a: Cryptocurrencies often have additional fees (e.g., transaction fees on exchanges), so this is a valid reason it's unsuitable for her low - risk, quick - transaction preference.
• Option b: Buying through online exchanges is common for crypto and not a reason it's unsuitable for her specific needs.
• Option c: Crypto is known for high price volatility (high risk of principal loss), which goes against her low - risk preference. But the question is about why it's least suitable, and high risk of loss is a major factor, but let's check other options.
• Option d: Crypto transactions are generally quick (e.g., blockchain transactions can be relatively fast in some cases, and with stablecoins or certain networks, speed is there), so this is incorrect.

Now, between a and c. Since Stephanie wants low - risk and quick transactions. The high risk of loss (option c) is a more fundamental reason why crypto is unsuitable for a low - risk investor. Also, the fact that it involves high risk of principal loss directly contradicts her preference for low - risk investments. The additional fees (option a) is a secondary factor compared to the risk factor. So the best reason is that it involves high risk of principal loss.

Answer:

c. It involves high risk of principal loss.