Question

what is risk, as pertains to investing?
a. the time period needed to find a buyer for an investment.
b. the cost of purchasing an investment.
c. the chance you take that your investments will lose their value.
d. the opportunity cost of tying your money up in investments.

Explanation:

To determine the correct answer, we analyze each option:

• Option a describes liquidity (time to find a buyer), not risk.
• Option b refers to the purchase cost, not risk.
• Option c defines investment risk as the possibility of losing value, which matches the concept of risk in investing.
• Option d describes opportunity cost, not risk.

Answer:

c. The chance you take that your investments will lose their value.