Assignment: Chapter $12$ Investing in Stocks and Bonds

Select the primary type of investment risk that corresponds to each of the given descriptions. $($Hint: These are not necessarily complete descrip but there is only one possible answer for each description.$)$

Description

Primary Risk

In some markets there are many buyers and sellers, such that it is relatively easy to cash$-$in an investment at any given time. In thin markets, however, it may be difficult to find a buyer in a timely manner, forcing the seller to lower the price and lose money on the investment.

CompWhiz is a tech company that initially sparked investor enthusiasm, resulting in a dramatic rise in share value after the initial public offering. In response to a rumor that the company's latest product contained a glitch, investors rushed to sell their shares, causing a sharp decline in the stock price.

Government securities guarantee fixed payments and set intevals. If the demand for money declines, however, the value of these securities declines as well.