The rate of return on bonds is lower than on stocks over time because
A) bond holders cannot diversify.
B) bonds have a lower standard deviation in returns.
C) stocks have less non-diversifiable risks than bonds.
D) bonds are subject to more random risks than stocks.
B
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Which of the following statements is true?
A) Hours of labor that go into producing a product is a better unit of account than paper money. B) When money is used as a yardstick to describe the price of various goods and services, it is serving as a store of value. C) The necessary condition required for money to function as a medium of exchange is that it also needs to be a store of value. D) One of the limitations of using money is that it does not allow for the transfer of purchasing power into the future.
During the Great Depression, cyclical unemployment increased as the recession continued. This increase in cyclical unemployment
A) increased the natural rate of unemployment. B) could have increased or decreased the natural rate of unemployment. C) decreased the natural rate of unemployment. D) had no effect on the natural rate of unemployment.