Investors face various choices regarding what they can invest in, and the choices carry varying amounts of risk. For example, stock prices are much more volatile than bond prices.

What is the typical reason why investors would choose to put their money into an investment with higher risk rather than one with lower risk?
- They want to signal their courage to other investors and scare them away.
- Assuming enough risk in a portfolio qualifies investors for a large government tax credit.
- Riskier investments typically have higher returns.
- Riskier investments are insured by the FDIC.
- They are irrational or are thrill‑seekers.

Answers

Answer 1

Answer:

Riskier investments typically have higher returns.

Explanation:

Although investors choose investments for many different reasons, most investors are seeking to earn a return. Ideally, they would like to earn a high return while exposing themselves to little risk, but what typically happens is that companies offering investments with higher risk know that they have to compensate investors for assuming that risk, or else they will not attract sufficient investment. Thus, higher‑risk investments typically offer a higher return, whereas companies offering lower‑risk investments know that they can offer a lower return and still attact investment. For example, a small company in a competitive, fast‑changing industry will typically offer to pay a higher interest rate for its corporate bonds than a large company in a stable industry.

Also, advertising using risque outfits seem to be more aimed at consumers than investors. Advertising for investors is typically rather boring, featuring graphs and numbers. Of course, one may find that the most interesting models of all are economic models. According to the risk-return tradeoff theory, higher risk is associated with greater probability of higher return and lower risk associated with a greater probability of lower return. The trade-off which the investor faces between risk and return while considering investment decision is called risk return trade-off.


Related Questions

what is the important factor in the eradication of the social problem? Write any one factor​

Answers

Answer:

9 and 6

Explanation:

9 and 6 is the important factor because you can multiple 9x6=54

HELP ASAP-WILL GIVE BRAINLIEST-NO FILES
How did voting in ancient Rome change over time?

A. Citizens started to vote on what was best for the whole of the Roman Empire.

B. Citizens only voted for what was best for the community

C. Citizens were required to vote based on the needs of others and not themselves.

D. Citizens began to vote based on self interest or what was best for themselves.​

Answers

Answer:

D

Explanation:

ohn eats a bowl of cereal for 3 of his 4 meals each day. He finishes two gallons of milk in eight days. How much milk does John use for one bowl of cereal? (Assume he only uses the milk for his cereal.)

Answers

Answer:

1/2

Explanation:

he uses 1/2 For one bowl of cereal.

요.
2
40
20
X
20 40 60
o
80 60 40 20
0
BO
20
O
40 N
Z
60
W-
E
A comparison of the average temperalures
on any given day at points Z, X, and U
on the globe would probably show that
the temperature at point X is

Answers

Answer:

what up dog

Explanation:

The original star-bellied Sneetches paid to have their stars removed then declared that they were better because of the lack of stars on their bellies. Because they were the dominant group, they could make and enforce such statements and other rules that ensure they retain their power. This is in line with which theory?

Realistic group conflict theory

Social dominance theory

Social identity theory

Intergroup conflict reduction

Answers

The theory described that shows the original star-bellied Sneetches maintaining power is the Social Dominance theory.

What is the Social Dominance theory?

This is a theory that talks about how a dominant group in a society will usually act in a way that ensures that they remain dominant.

The original star-bellied Sneetches made and enforced statements that maintained their power as the dominant group which is in line with the concepts espoused by the Social dominance theory.

In conclusion, option B is correct.

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I need help is economic btw

Answers

Answer:

corporate income taxes

Explanation:

The full employment level of real GDP is $6 billion for the recently formed island nation of Turtleopolis. Use the line segment to show long‑run aggregate supply on the graph.

Answers

Answer:

*see image*

Explanation:

The long‑run aggregate supply curve is vertical at the point of full employment GDP. In this case, it is $6 billion. A change in the price level will not affect the production capabilities of an economy in the long run. LRAS is at the same point of real GDP for every price level. The LRAS curve will shift when the economy experiences growth, but, even then, it will maintain its vertical shape.

PLEASE HELP! What major country represents democracy during the Cold War?

Answers

The United States represents democracy during Cold War

Which statement best describes an advantage of indirect democracy over direct democracy?
A. It can be more responsive to citizens' interests.
B. It can help citizens feel more connected to government.
C. It can better reflect the democratic principle of majority rule.
D. It can make decision making more efficient.

Answers

Answer:

it would be A

Explanation:

the term domestication refers to?

Answers

Domestication is the process of adapting wild plants and animals for human use.

ECONOMICS

In which situation does the national debt decrease?

A. The federal government has a balanced budget.

B. The federal government has a decrease in the federal deficit from the previous fiscal year but still has a deficit

C. The federal government hwd a surplus in the budget

D. The federal government has an increase in the federal deficit from the previous fiscal year

Answers

Answer:

To reduce the debt, the country could raise taxes and/or cut spending. These are two of the tools of contractionary fiscal policy, and either tactic could slow economic growth.

Explanation:

When the federal government has a decrease in the national debt from the previous fiscal year, it implies a situation where the national debt decreases.

How does the government reduce the national debt?

There are several strategies used, one of the most common being the issuance of debt in the form of bonds so that the government can raise funds, and may adopt a policy of repurchasing the bonds if necessary, such as the "Quantitative Easing" policy in the US.

Therefore, in order to reduce the national debt, the government must stimulate the economy and identify strategies for raising money.

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#SPJ2

When should you start planning for retirement?
O You should start planning as soon as you decide on a career path.
O You should start planning after starting a job and buying a home.
You should start planning only after receiving an income tax refund so that the money
can be deposited immediately.
You should start planning after college graduation and after you have developed your
financial goals.

Answers

Answer: You should start planning as soon as you decide on a career path.

Explanation: The whole idea of retirement is to have something to look forward to. Choosing a career path will better help you get started in what exact steps you have to take in order to get yourself where you want to be. Working on a retirement plan too late becomes more stressful and you are less likely to make a good decision under the last-minute cramping of ideas.


Monopolies are usually harmful to economies because they:

Answers

D. Because if they own everything, they can jack up prices

Which of the following is the best way to avoid plagiarism? Select one: a. Copy the good bits from different resources. b. Reuse an answer your friend gave you, but change the words. c. Use quotations and give credit when referring to resources you used. d. Complete each assignment that does not ask for group work as a group.

Answers

Answer:

A

Explanation:

If you copy good parts from different resources it still won't look the same as the orginal source your taking from, because your taking from multple sources.

Observe your community, what do you think is trending today? Why do you say so?

Answers

By observing your community, you will notice that there are certain things that are trending and you can then investigate further to find out why those things are happening.

What is trending in your community?

This is an essay type question and so I cannot give you the answer but I can help guide you.

First you should observe your community to find out if there are any new and popular trends emerging. For instance, more people might be using bicycles to get to work.

You then give evidence as to why you believe your observation is a new trend. For instance, you compare your current observation on bicycles, to bicycle numbers in the past number of years.

You could pull up bicycle numbers for your areas on the internet, interview a bicycle salesman in the area, or draw evidence from your own memory of bicycle usage in the past.

Find out more on essay writing at https://brainly.com/question/94727.

When members of a family system are over involved with each other's affairs and are over concerned with the details of each other's lives, they are said to be:

Answers

An enmeshed family is a kind of family system where family members are usually involved with each other's affairs.

What is an enmeshed family ?

An enmeshed family serves as the type of the family system that are mote concerned about the affairs and well being of each other.

Therefore, enmeshed family usually look out for each other and care about each other.

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PLEASE HELP ME

Explain what the Radical Republican Plan for Reconstruction was?​

Answers

Answer:

New opportunities to African-American people

Explanation:

The Radical Republicans' reconstruction offered all kinds of new opportunities to African-American people, including the vote (for males), property ownership, education, legal rights, and even the possibility of holding political office. By the beginning of 1868, about 700,000 African Americans were registered voter's.

This was confrontation Between the soviet union and the united states over nucler missiles the soviets had allegedly deployed to cuba

Answers

The Cuban Missile Crisis

Europa, a moon that orbits Jupiter, is quite different from Earth’s Moon. One characteristic it shares with Earth’s Moon is that Europa–

Answers

Answer:

Europa and Earth's moon is about the same size

with Europa being 10% smaller

Suppose that an economy consists of only two individuals. Jeremy has $1890 available to spend on goods. He decides to purchase $390 worth of produce from Krista in the current quarter. No other economic activity takes place during the current quarter. Using this information, answer the questions.

For the current quarter, what is the economy's income? $_____________
For the current quarter, what is the economy's expenditure? $_____________

In an economy, how are income and expenditure related?
a. Income is less than expenditure.
b. They are equal.
c. They are unrelated.
d. Income is greater than expenditure.

Answers

Answer:

Economy's income: $390

Economy's expenditure: $390

b. They are equal.

Explanation:

In an economy Income (Y) is the sum of Consumption or private expenditure (C), Investment (I), Government spending (G), and Net Exports (NX).

Y = C + I + G + NX

But as the economy consists only of 2 individuals, Investment (I), Government spending (G), and Net Exports (NX) are Zero. Therefore,

Y = C i.e. Income = Expenditure

In the above scenario, Jeremy spends $390 on produce from Krista. Jeremy's expenditure is equal to Krista's income which is $390. Under the assumptions in this scenario, the sum of all spending that occurs in the economy is exactly equal to the sum of all income that people receive.

In the question, Krista receives $390 in income from selling her produce to Jeremy. The $390 that Jeremy paid for the produce is the amount of expenditure for the economy. The $1890 Jeremy could have used is irrelevant since it is not used in the current quarter. The expenditure a buyer pays for a good or service is equal to the income the seller receives.

For the U.S. government, which of the given is NOT an example of discretionary spending?
a. Medicare
b. defense spending
c. science spending
d. Medicaid

For the U.S. government, which of the given is NOT an example of mandatory spending?
a. education spending
b. interest on the national debt
c. Social Security
d. Medicare

Which type of spending currently takes up a larger proportion of the U.S. federal budget?
a. Mandatory spending and discretionary spending take up an equal amount.
b. mandatory spending
c. discretionary spending

Answers

Answer:

- Medicare

- Education spending

- Mandatorym spending

Explanation:

Discretionary spending is subject to an annual appropriation process by Congress. In contrast, mandatory spending is authorized by permanent laws and therefore can not be easily changed.

The answer to the first question is that Medicare is not a type of discretionary spending. Medicare is a type of mandatory spending. Discretionary spending includes defense, science, income security (including Medicaid), transportation, environment, education, veterans' benefits and services, etc.

The answer to the second question is that education spending is not a type of mandatory spending. Spending on education is a type of discretionary spending. Mandatory spending includes Medicare, Social Security, interest on the national debt, food stamps, TANF (temporary assistance for needy families), etc.

The answer to the last question is that the majority of the budget is spent on mandatory spending items. Mandatory spending accounts for about 60%, whereas discretionary spending accounts for about 40%.

In 3 John, John commends the elect lady and her children for their faithfulness in lovingly helping fellow Christians and strangers. true false

Answers

The answer to the question is false because 3 John is not about the  elect lady and her children.

What is the 3 book of John about?

This chapter of the book is mostly about the hospitality that has been shown to the people of Christian faith.

The book mostly highlights the importance of hospitality especially to the people that were spreading the gospel.

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Adnon just hired Petra to be part of the financial team and requested that she be at the office at 7:30 a.m. on Monday for her first day. Adnon then e-mailed Petra to remind her two times over the weekend. Adnon assumed that Petra would be late because she is very young and Adnon believes that all young people are irresponsible and disorganized. Which type of perception bias is Adnon showing

Answers

The Frame of reference that influences a perception bias is that type of bias that Adnon is showing towards Petra.

What is a perception bias?

This is a bias that occured when individual's perception is affected by the stereotypes or assumptions they have about other groups.

Also, the Frame of reference influences a perception bias because personal set of beliefs or ideas influences onr judgment of things.

In conclusion, Adnon is showing a perception bias called Frame of reference as she believes that all young people are irresponsible because it is framed from what she knows only.

Read more about Frame of reference

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examine the concept of the poor

Answers

Answer:

Although poverty is one of the most well-known and long-lasting circumstances in human history, it is a difficult idea to grasp. Some experts believe it is a reaction to the stress of poverty, while others believe it is a process of adjusting to poverty. There are several historical definitions, but they all relate to a lack of financial income or a reduced social position. Poverty is influenced by a variety of variables, including political, economic, social, and cultural pressures. The passage of time, which encompasses all of these elements in a very complicated manner, has consistently had the biggest impact on the evolving concept.

Explanation:

If the government of Balancia runs a deficit of $50 million per year in Year 1 and in Year 2 due to its recession, but then has a $100 million surplus in Year 3 due to strong economic recovery, Balancia is likely following which type of rule?

Functional finance

Cyclically balanced budget

Biannually balanced budget

Annually balanced budget

Answers

Balancia is likely following the cyclically balanced budget

This event took place in the western Hemisphere from July 26, 1953, to January 1, 1959 resulting in the overthrow of Fulgencio Batista and the creation of a communist government.

Answers

The Cuban Revolution

Which of the following would be an example of expansionary fiscal policy?

a reduction in interest rates

a reduction in government subsidies to farmers

a reduction in income taxes on low-income earners

a reduction in unemployment benefits

Answers

A reduction in income taxes on low-income earners

Production and income taxes increases the level of disposable income, and this increases advocate demand. A cutting income taxes an example of expansionary physical policy.

who was the most important person in 1860

Answers

Answer:

M. Visvesvaraya, Lizzie Borden, Anton Chekhov, Jane Addams, Gustav Mahler and many more.

Explanation:


The doctrine that holds the view that historical circumstances are determined by a sequence of economic events
connected to the act of production is known as ............
O A. Economic determinism
O B. Historical materialism
11 a 0
O C. Rationalization
O D. Economic materialism

Answers

B historical materialism

how lack of responsible citizenship can lead to further cases of human rights violation within a community

Answers

The main way in which a lack of responsible citizenship can lead to further cases of human rights violation is a lack of accountability.

What is Responsible Citizenship?

This refers to the activity of citizens where they engage in acts or actions that helps their community and the government to make society better for everyone.

Hence, we can see that the lack of this in society, would lead to less accountability and would inevitably lead to further cases of human rights violations within the community.

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