What was Ponzi's method of paying earlier investors?
Using his own money
Borrowing money
Using the investments of later investors
Stealing money
Answer
Ponzi schemes are fraudulent investments where returns for earlier investors are paid using funds from more recent ones, creating an illusion of profitability. This practice is unsustainable as it relies on a constant flow of new investors to keep the scheme afloat, eventually leading to the collapse of the entire operation and significant losses for those involved.
Ponzi Scheme Prodigy: The Charles Ponzi Quiz
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