What is the key difference between a Ponzi scheme and a Pyramid scheme?
In a Pyramid scheme, participants recruit others to invest
A Ponzi scheme promises high financial returns or dividends not available through traditional investments
There is no difference
Ponzi scheme is legal while Pyramid scheme is illegal
Answer
A Ponzi scheme is fundamentally fraudulent, dependent on a continuous influx of new investors to repay earlier ones without any legitimate business or investment activities sustaining the returns. It relies on deceit and misrepresentation to maintain the illusion of profitability when in reality no meaningful income is being generated.
Ponzi Scheme Prodigy: The Charles Ponzi Quiz
More Questions
Subscribe Now!
Learn something
new everyday
Playing quizzes is free! We send 1 quiz every week to your inbox