7.3k views
3 votes
Rank in order of average rate of return (1 being the lowest)?

1) Mutual fund
2) C.D.
3) Bond

1 Answer

4 votes

Final answer:

The average rate of return can be ranked from lowest to highest as follows: bank accounts (savings account), bonds, and stocks (mutual funds).

Step-by-step explanation:

The average rate of return can be ranked from lowest to highest as follows:

  1. Bank accounts (savings account): Bank accounts have very low risk and very low returns. The value of a savings account changes very little over time.
  2. Bonds: Bonds have higher risk but higher returns compared to bank accounts. The value of a bond varies less than a stock but more than a savings account because it depends largely on interest rate fluctuations.
  3. Stocks (mutual funds): Stocks have the highest risk but also have the potential for higher returns compared to bank accounts and bonds. Stock values can grow or decline by a large amount over a sustained period of time.
User Dark Cyber
by
8.1k points

No related questions found

Welcome to QAmmunity.org, where you can ask questions and receive answers from other members of our community.