Investment is the act of redirecting resources from being consumed today so that they may create benefits in the future
It is all about profit!
Contributes to a nation’s wealth-promotes growth
The Financial System
Allows for the transfer of money to take place
People use financial assets, or promises that the borrower will pay them back
All of this allows for new products and development
Institutions that help channel funds from savers to borrowers
Banks, credit unions, finance companies
Risk:spread the wealth! Invest in more than one thing!
You are going to be an investment counselor for two investors, Tom and Rachel.
Evaluate each investor’s personal and financial situation, assess trade-offs between risk and return, and then make recommendations about how much risk that investor should assume and the types of investments he or she should make.