Of the following, the safest type of investment is:

Under the mattress.
An FDIC-insured CD.
An international growth mutual fund.
An Internet stock.

Since the mid-1920s inflation in the United States has averaged:

About 3 percent.
About 7 percent.
About 10 percent.
About 12 percent

A prudent investor:

Does not have to consider the tax effect of long-term gains.
Evaluates his/her investments on an after-tax basis.
Studiously avoids income-shifting among funds.
Knows that a drop in the dividend payout signals a stronger firm.

The astute investor is aware that:

Investment risk is limited to the fortunes of the specific security purchased.
Computers make investment decisions scientific and eliminate much of the risk.
Actual outcome of any investment may differ from the expected outcome.
When trading on-line, brokerage commissions are always negotiable.

A zero coupon bond:

Is sold at a discount to face value.
Is worthless.
Matures immediately.
Always has a call feature.

A benchmark asset, commonly considered by investors to be risk-free:

Treasury Bill (T-Bill).
Share of preferred stock.
A Eurobond
A junk bond.

Stocks whose returns are tied closely to the overall national economy are typically called:

Blue Chip stocks.
Defensive stocks.
Speculative stocks.
Cyclical stocks.

Investments in CDs:

Are riskier than investments in stocks.
Are inferior to investments in 8-tracks and vinyl records.
Are always tax deferred.
Are insured by the FDIC, but have generally underperformed stock investments over the long run.