The chart on page 14 of Building Wealth compares two investors, one who starts at age 25 and invests to for 40 years, the other who starts at age 45 and invests for 20 years. Which of the following is not true?Group of answer choicesThe differing amount of principle contributed by each of the two investors explains the dramatic differences in their results.Both are earning 8% compounding interest.The compounding formulas are the same between the two investors.Both are investing $3,000 annually.Time is the most important variable affecting the different returns between the two individuals.

In age-based asset allocation, the investment decision is based on the age of the investors. Therefore, most financial advisors advise investors to make the stock investment decision based on a deduction of their age from a base value of a 100. The figure depends on the life expectancy of the investor. The higher the life expectancy, the higher the portion of investments committed to riskier arenas, such as the stock market.ExampleUsing the previous example, let’s assume that Joe is now at 50 years and he is looking forward to retiring at 60.  According to the age-based investment approach, his advisor may advise him to invest in stocks in a proportion of 50%, then the rest in other assets. This is because when you subtract his age (50) from a hundred-base value, you’ll get 50.Now assume that Joe was 35 years old, instead of 50. Which of the following would not be true?Group of answer choicesMore of Joe's investments should be in stocks.The implied message is that stocks are riskier than other investments.65% of investments should be in less risky investments.None of these are true.Joe would have a higher life expectancy at age 35 than at 50/

Multiple Choice QuestionCompany A has a return on investment of 20% and Company B has a return on investment of 24%. Assuming both companies have the same investment center average assets, which of the following statements is true?Multiple choice question.Company A has higher investment center income than Company B.Company B is more efficient in using its assets to generate profits.Company B has higher return on investment than Company A.Company A is more efficient in using its assets to generate profits.

Fill in the Blank QuestionFill in the blank question.The younger you are as an investor, the more likely you are to invest a portion in growth investments.

You make two investments as follows:Investment of $100 that yields $130 after three years,Investment of $100 that yields $140 after four years,Which of the following statements is true?2 MarksThe investment with less number of resources is more preferableShort term investments are always preferableThe investment with higher Opportunity cost is preferableThe investment with higher NPV is more preferable

If an amount of Rs.12000 is invested in two different schemes of which one is SI with 10% p.a interest and the other is CI with 10% p.a interest, compounded half-yearly, what will be the difference between SI and CI at the end of 1 year?