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Risk And Return

9 practice questionsFinanceStep-by-step solutions

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1

In general, investments offering higher expected returns also carry:

A.Lower risk
B.Higher risk
C.No risk
D.Guaranteed returns
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2

Systematic (market) risk is best described as risk that:

A.Affects only one company
B.Affects the entire market and cannot be diversified away
C.Is fully eliminated by diversification
D.Does not exist
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3

A bond with a higher risk of default will generally offer investors a:

A.Lower yield
B.Higher yield to compensate for the risk
C.No yield
D.Guaranteed government backing
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