Which of the following statements is CORRECT?
A) Compared to stocks, bonds have a higher return.
B) Compared to stocks, bond returns have a higher standard deviation.
C) Compared to bonds, stock returns have a lower standard deviation.
D) Compared to bonds, stock returns have a higher standard deviation.
D
You might also like to view...
Which of the following was an implication of the U.S. government's Clean Air Act Amendments (CAAA) of 1977?
A) It acted as a barrier to entry. B) It increased consumer surplus. C) It reduced the profits of existing firms. D) It reduced the market power of existing firms.
Consider two upward sloping income-utility curves with income on the horizontal axis. The steeper curve represents risk preferences that are more:
A) risk averse. B) risk loving. C) loss averting. D) We cannot answer this question without more information about the shapes of the curves.