Which of the following provides young people with a strong incentive to make regular payments into a retirement program and invest these funds in a diverse set of stocks?
A) The prices of stocks tend to fluctuate more than the prices of bonds.
B) Over short periods of time, variation in the real rate of return of stocks is greater than bonds.
C) When held over lengthy periods like 30 or 40 years, historically the rate of return on stocks has been both higher and less variable than that of bonds.
D) Lower interest rates will lead to higher bond prices.
Correct Answer:
Verified
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