Because of her children's immediate financial needs,your aunt Marsha has decided to switch some of her money to high-grade utility company stocks.Her reasoning is that these ________ stocks generally pay relatively high dividends that she will be able to give to her children as they need assistance.

Question

Quizplus · Accepted Answer

The term "high-grade" implies that the stocks are of high quality and reliability, which suggests a focus on stability and income over growth potential. Among the answer choices, the only option focused specifically on generating income is C, income stocks. Blue-chip stocks (B) may also pay high dividends, but are typically chosen more for their long-term growth potential. Safe (E) is a vague term that could apply to any of the answer choices, and cyclical stocks (D) are generally more volatile and not a reliable source of income.

Because of Her Children's Immediate Financial Needs,your Aunt Marsha Has