Question

What does risk tolerance represent in investment planning?

a.

The willingness to invest in risky assets

b.

The measure of how much risk someone is willing to take in purchasing an investment

c.

The ability to predict market fluctuations

d.

The rate of return on investments

Posted under IC38 Life Insurance Agent Exam

Answer: (b).The measure of how much risk someone is willing to take in purchasing an investment Explanation:Risk tolerance in investment planning represents the measure of how much risk someone is willing to take when purchasing an investment, taking into account their comfort level with investment risks.

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Q. What does risk tolerance represent in investment planning?
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