How do ponzi schemes work?
What will be an ideal response?
Ponzi schemes are based on a trust relationship between the investor and the scheme’s promoter. The promoter promises new investors high or steady returns for making the investment. As the money gets invested, the promoter uses funds from new investors to pay high returns to current investors into the scheme. The scheme can work so long as there is a steady stream of new funds to continue paying high returns to the current investors. In the process the scheme’s promoter siphons off some of the funds to be used for personal enrichment.
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Which of the following is typically considered a fixed cost by academic book publishers but a variable cost by companies that print books?
A) postage and supplies B) wages and salaries C) travel D) rent
In the 19th century, Russian peasants noticed that during cholera epidemics there were lots of doctors around; in an attempt to eliminate cholera, they killed all the doctors. This is an example of
a. mistaking correlation with causation. b. the fallacy of opportunism. c. excessive abstraction. d. rationality. e. marginal analysis.