For any given financial asset, risk levels and average expected rates of return are:

A. independent of each other.
B. negatively related because assets with higher average expected rates of return sell for
higher prices, which are inversely related to risk.
C. positively related because both are inversely related to the rate of inflation.
D. positively related because investors must be compensated for taking greater risks.

D. positively related because investors must be compensated for taking greater risks.