Question

John Hernandez is 24 years old and has saved enough money to fund an adequate emergency fund. In addition, he has saved $5,600 that can be used to fund an investment program. He is single, has no dependents, and would like to retire when he is 60 years old. Which one of the investment factors listed below would be most important for an investor like Mr. Hernandez?
A) betaB) incomeC) growthD) riskE) liquidity

Answer 1

Answer:

C) growth

Explanation:

Based on the scenario being described within the question it can be said that the most important factor for Mr. Hernandez would be growth. This refers to the amount that his assets can grow in value over a certain period of time. This would be the most important factor because he is a young investor with no dependants and his age of retirement is very long term, meaning he can afford to take higher risks and use more of his capital.

Answer 2

Answer:

C. Growth

Explanation:

Starting investment early is something that is always encouraged and that is the case of John Hernadez here. By starting early, before he retires, he'd have been able to grow is investment portfolio substantially and even be a millionaire by the time of his retirement. Growth is the most important factor for John, that's why is he's starting his investment early. With the time given for growth, investment value may increase in value and it allows time for appreciation of stock price.