Which of the following statements is not true with regard to the returns you wou

Question

Which of the following statements is not true with regard to the returns you would expect from your investments:

A) Earning interest on interest refers to the need to look at the outflow of cash from the investment and how those outflows are invested while the investment is held.

B) Investing the interest and dividends earned on an investment back into that investment or a similar investment helps to address the concern with earning interest on interest that the author raises.

C) All of these statements are true.

D) Capital gains refers to the appreciation (increase) in the price of the investment.

E) Current income refers to the current earnings one earns on the investment such as dividends and interest.

Explanation / Answer

The correct answer is C) All of these statements are true.

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