• Dollar-cost averaging: Investing a set amount on a regular schedule, like $50 every month, no matter what the market is doing. You buy more shares when prices are low and fewer when they're high, and you never have to guess the "right" time.

1. Reinvested returns compound.
2. Dollar-cost averaging = invest the same amount on a schedule.
3. Starting early is the most powerful move.
4. Real returns are uneven and never guaranteed.

1. 1. A. Uses dividend payments to buy more shares, so future returns compound on a bigger baseReinvesting turns income into more ownership, which can produce more income — compounding.
2. 2. C. Dollar-cost averagingDollar-cost averaging removes the guesswork of timing and buys more shares when prices are lower.
3. 3. TrueEarly dollars have the most time to compound. Time is often the biggest factor.

1. 1. 5 + 4 + 10 + 5 = 24 shares for $400 — an average of $16.67 per share, lower than the $18.75 average price. That's dollar-cost averaging.
2. 2. The fee is charged every year on a growing balance, and the money lost to fees can't compound — so the gap widens over time.

Answers will vary. Look for reasoning that uses the lesson's key ideas:

• Reinvested returns compound.
• Dollar-cost averaging = invest the same amount on a schedule.
• Starting early is the most powerful move.
• Real returns are uneven and never guaranteed.